Problem 12 6 Sanville Quarries is considering acquiring a new drilling machine that is expected to be more efficient than the current machine The project is to be evaluated over four years The initial outlay required to get the new machine operating is $675,000 Incremental cash flows associated with the machine are uncertain, so management developed the following probabilistic forecast of cash flows by year ($000) Sanville's cost of capital is 11 Year 1 Prob Year 2 Prob Year 3 Prob Year 4 Prob $150 30 $200 35 $350 30 $300 25 175 40 210 45 370 25 360 35 300 30 250 20 400 45 375 40 Calculate the project's best NPV Round the answer to the nearest whole dollar Enter your answer in dollars and not in thousands of dollars For example, an answer of $1 thousand should be entered as 1,000 not 1 $ What is the probability of best NPV Round the answer to five decimal places Calculate the project's worst NPV Round the answer to the nearest whole dollar Enter your answer in dollars and not in thousands of dollars For example, an answer of $1 thousand should be entered as 1,000 not 1 $ What is the probability of worst NPV Round the answer to five decimal places

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Problem 12-6 Sanville Quarries is considering acquiring a new drilling machine that is expected to be more efficient than the current machine. The project is

Problem 12-6

Sanville Quarries is considering acquiring a new drilling machine that is expected to be more efficient than the current machine. The project is to be evaluated over four years. The initial outlay required to get the new machine operating is $675,000. Incremental cash flows associated with the machine are uncertain, so management developed the following probabilistic forecast of cash flows by year ($000). Sanville's cost of capital is 11%.

Year 1	Prob	Year 2	Prob	Year 3	Prob	Year 4	Prob
$150	.30	$200	.35	$350	.30	$300	.25
175	.40	210	.45	370	.25	360	.35
300	.30	250	.20	400	.45	375	.40

Calculate the project's best NPV. Round the answer to the nearest whole dollar. Enter your answer in dollars and not in thousands of dollars. For example, an answer of $1 thousand should be entered as 1,000 not 1. $ What is the probability of best NPV? Round the answer to five decimal places. Calculate the project's worst NPV. Round the answer to the nearest whole dollar. Enter your answer in dollars and not in thousands of dollars. For example, an answer of $1 thousand should be entered as 1,000 not 1. $ What is the probability of worst NPV? Round the answer to five decimal places.