Question Help A bicycle manufacturer currently produces 207.000 units a year and expects output levels to remain steady in the future. It buys chains from an outside supplier at a price of $1.90 a chain. The plant manager believes that would be cheaper to make these chains rather than buy them. Direct in-house production costs are estimated to be only $1.50 per chain. The necessary machinery would cost $284,000 and would be cbsite after ten years. This investment could be depreciated to zero for tax purposes using a ten-year straight-ine depreciation schedule. The plant manager estimates that the operation would require $45,000 of Inventory and other working capital upfront (year), but argues that this sum can be ignored since it is recoverable at the end of the ten years. Expected proceeds from scrapping the machinery after ten years are $21,300 If the company pays tax at a rate of 35% and the opportunity cost of capital is 15%, what is the net present value of the decision to produce the chains in house instead of purchasing them from the supplier? Project the annual tree cash flows (FCF) of buying the chains The annual free cash flows for years 1 to 10 of buying the chain is $. (Round to the nearest dolar. Enter a free cash outlow as a negative number) Compute the NPV of buying the chains from the FCF The NPV or buying the chains from the FCF Round to the nearest dollar. Enter a negative NPV as a negative number) Compute the intal FCF of producing the chains The initial FCF of producing the chains is $(Round to the nearest doller. Enter a free cash outlow as a negative number) Compute the FCF in years through 9 of producing the chains The FCF in years 1 through of producing the chains is $1. Round to the nearest dolor. Enter a free cash outlow as a negative number.) Compute the FCF in year 10 of producing the chains The FCF in your 10 of producing the chains is $(Round to the nearest olur. Ertor a free cash outflow as a negative number) Compute the NPV of producing the chains from the FCF The NPV of producing the chains from the FCF (Round to the nearest collar. Enter a negative NPV as a negative number) Compute the citforence between the not present Valve found above The not present value of producing the chains in-house instead of purchasing them from the supplier is $ (Round to the nearest dolar) Enter your answer in each of the answer boxes