You're given a project that last 8 years. The project is a bike-share manufacturing plan. Projected unit sales, price and variable cost per unit are as follow: Initial capital investment is $900,000. You also assign $28,000 of fixed cost a year, with depreciation method of 7 year MACRS, and 25% tax rate. The initial NWC is $42,000 and 15% of sales thereafter. The fixed asset (machines) can be sold for $110,000 at the end of the project. If the discount rate is 13%, should you invest in the project? The unit sold, price and variable cost (VC) are as follow: 1. Create a pro forma financial statement that is similar to the ones you see in the textbook and tutorial video, with OCF, FCF and NPV calculation clearly displayed. 2. Conduct a sensitive analysis and scenario analysis. For the sensitivity analysis, change price by $10 up and $10 down. Also change the VC by $10 up and $10 down. How have these changes affects the NPV? Should you be more concerned about prices or variable cost? For the scenario analysis, change the unit sold by 500 units up and down for each of the years. How have these changes affect the NPV? Should you be concerned about the accuracy of your unit sold forecast? Note: if you done the Excel setup correctly, the sensitivity and scenario analysis will be pretty easy