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This is all of the information that the question provides. I need help with part d. Buhler Industries is a farm implement manufacturer. Management is

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedThis is all of the information that the question provides. I need help with part d.

Buhler Industries is a farm implement manufacturer. Management is currently evaluating a proposal to build a plant that will manufacture lightweight tractors. Buhler plans to use a cost of capital of 12% to evaluate this project. Based on extensive research, it has prepared the following incremental free cash flow projections (in millions of dollars): Year 0 Free Cash Flow ($000,000s) Revenues Manufacturing expenses (other than depreciation) - Marketing expenses - CCA = EBIT - Taxes (35%) = Unlevered net income + CCA Years 1-9 95.00 - 31.00 - 11.00 ? ? Year 10 95.00 - 31.00 11.00 ? ? ? ? ? ? ? ? -5.00 - 5.00 - 149.00 - Additions to working capital - Capital expenditures + Continuation value = Free cash flow + 10.00 - 149.00 ? ? The relevant CCA rate for capital expenditures is 20%. Assume assets are never sold. d. To examine the sensitivity of this project to the discount rate, management would like to compute the NPV for different discount rates. Create a graph, with the discount rate on the X-axis and NPV on the y-axis, for discount rates ranging from 5% to 30%. For what ranges of discount rates does the project have a positive NPV? NPV is $ 73.93 million. (Round to two decimal places.) What is the NPV if revenues, manufacturing expenses, and marketing expenses grow by 7% and initial capital expenditures, additions to working capital, and continuation value remain the same? NPV is $ 109.47 million. (Round to two decimal places.) d. To examine the sensitivity of this project to the discount rate, management would like to compute the NPV for different discount rates. Create a graph, with discount rate on the x-axis and NPV on the y-axis, for discount rates ranging from 5% to 30%. For what ranges of discount rates does the project have a positive NPV? Assuming zero percent growth of revenues, manufacturing expenses, and marketing expenses, what is the NPV when the discount rate is 5%, 20%, and 30%? The NPV when the discount rate is 5% is $ million. (Round to two decimal places.)

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