A project has equipment requirements that will cost $150,000 installed.NWC of $50,000 will also be required.The project is replacing old equipment that can be sold for $25,000, book value 0.If accepted, each year the project will generate new revenues of $250,000, and new expenses of $125,000.The equipment will be depreciated as a 3 year asset under MACRS.The useful life is 5 years.The new equipment has an estimated salvage value of $20,000.The company's tax rate is 40%.

a.What is the NINV for the project?

b.Calculate the NPV, IRR, MIRR and PI for the project, if your required rate is 12%?

c.Perform a best case/worst case scenario analysis for this project, assuming revenues may vary by +/- 10%.How significant do you believe this risk analysis is on the acceptability of the project?