(Related to Checkpoint 13.2 and Checkpoint 13.3) (Comprehensive risk analysis) Blinkeria is considering introducing a new line of hand scanners that can be used to copy material and then download it into a personal computer. These scanners are expected to sell for an average price of $98 h, and the company analysts performing the analysis expect that the firm can sel 105,000 units per year at this price for a period of five years, after which time they expect demand for the product to end as a result of new technology In addition, variable costs are expected to be $20 per unit and fixed costs, not including depreciation, are forecast to be $1,050,000 per year. To manufacture this product, Blinkeria will need to buy a computerized production machine for $9.9 million that has no residual or salvage value and will have an expected life of five years. In addition, the firm expects it will have to invest an additional $304,000 in working capital to support the new business Other pertinent information concerning the business venture is provided here: B a. Calculate the project's NPV. b. Determine the sensitivity of the project's NPV to a[n) 9 percent decrease in the number of units sold c. Determine the sensitivity of the project's NPV to a[n) 9 percent decrease in the price per unit d. Determine the sensitivity of the project's NPV to a[n) 9 percent increase in the variable cost per unit e. Determine the sensitivity of the project's NPV to a[n) 9 percent increase in the annual fixed operating costs provided here ! xpects it will have to invest an additional $304,000 in working capital to support the new business. Other p i X - Data Table projed projed projed projec a tha be | le for the Initial cost of the machine Expected life Salvage value of the machine Working capital requirement Depreciation method Depreciation expense Cash fixed costs-excluding depreciation Variable costs per unit Required rate of return or cost of capital Tax rate $9.900,000 5 years $0 $304,000 straight line $1,980,000 per year $1,050,000 per year $20 10.6% 34% Print Done