Purpose: Evaluate and balance uncertainty when performing capital investment analyses KSAS: Understand capital investment analysis (NPV, IRR, etc.); apply uncertainty to analysis Points: 10 Admin: None Discussion Initial Response Due by Wednesday: COVID-19 brought tremendous change to the world from health, relationship, and economic perspectives. For this discussion, focuses on the economic perspectives to evaluate uncertainty in a capital investment analysis. Everyone was impacted by the economic impacts of COVID-19 to include nonprofits. Donations plummeted and volunteers dried up but the community's need for help only grew. The table below provides information for the Transformation Station, a nonprofit that focuses on people experiencing homelessness for the first time. Transformation Station has determined they need a bigger storage facility. They first need to perform an analysis to determine whether to build a larger storage facility. There is a lot of uncertainty with COVID-19 so include sensitivity analysis in your calculations. Conservat Most ive Likely Estimate Estimate Optimis tic Estimat e Construction cost of warehouse $25,000, $23,00 $20,00 000 0,000 0,000 Residual value $ 0.00 $2,000, $3,000, 000.00 000 Useful life 25 years 25 years 25 years Estimated annual net cost savings Rate of return $1,000,00 $3,000, $4,000, 0 000.00 000.00 10% 12% 14% Part 1: Perform a sensitivity analysis for the three options above. Show your work to receive full points. Part 2: If you were the director of the Transformation Station, would you build the warehouse? Why? Discussion Response Due by Saturday: Review another student's construction decision. Do you agree with the decision and why