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Task #2 If the Pines close the storefront location, they are considering adding an additional ice cream truck. They expect the operating costs to be

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Task #2 If the Pines close the storefront location, they are considering adding an additional ice cream truck. They expect the operating costs to be similar to the operating costs of the existing trucks, with the exception of utilities - the newer trucks are much more energy- efficient, so the Pines expect the utility costs to be 30% lower. As Aurora and Lokee are heading toward retirement, they would like to operate the truck in the neighbouring city of Airdrie, which would also allow them to park the truck on their property for free and stay closer to home. Airdrie is one of the fastest-growing communities in Alberta. Despite struggles with licensing in the past for the Calgary trucks, Aurora and Lokee are confident that they could get another food truck licence given that they now have an understanding of the licensing process. There may be some new challenges, since Airdrie is a separate municipality from Calgary with different requirements. There are currently no ice cream shops in Airdrie that offer dairy-free alternatives; however, the environment in Airdrie is different than the downtown hub, so sales may not be as strong as the existing trucks - the Pines estimate that they could retain their current pricing and see a sales decline of 10%. An increase in price of 25% would see a sales decline of 20%. The new truck would have an upfront cost of $100,000, net of tax shield and after five years would be able to be sold for $60,000, net of taxes and disposal costs. Aurora and Lokee would operate the truck themselves at the above-noted salary of $100,000 each. Prepare a quantitative assessment to analyze replacing the storefront with an ice cream truck in Airdrie. Be sure to include a sensitivity analysis. Your response should be no longer than half a page, excluding any work in Excel

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