Question: Please help: Considering inflation, what changes would you make to the base-case numbers associated with your NPV analysis? How might those changes impact the expected
Please help:
Considering inflation, what changes would you make to the base-case numbers associated with your NPV analysis? How might those changes impact the expected cash flows (and NPV)?
Need to do all calculations first before we can figure this out

2016 2017 2018 2019 2022 Year Sales revenue ($million) Operating cost savings Cost of goods sold Selling, general & Administrative (SG&A) Depreciation expense Operating income ($million) Taxes (40%) NOPAT Depreciation NWC investment Capital investment NWC recovery Capital investment recovery Free cash flow ($ millions) Net present value ($million) Internal rate of return (IRR) 4.00 2.00 (3.00) (0.20) (3.00) (0.20) (0.08) (0.12) 3.00 (0.40) (2.00) 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 (0.60) 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 2020 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 2021 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 (16.00) 1.00 1.08 6.58 0.48 3.90 4.50 4.50 4.50 (16.00) 2.30 11.07% 2016 2017 2018 2019 2022 Year Sales revenue ($million) Operating cost savings Cost of goods sold Selling, general & Administrative (SG&A) Depreciation expense Operating income ($million) Taxes (40%) NOPAT Depreciation NWC investment Capital investment NWC recovery Capital investment recovery Free cash flow ($ millions) Net present value ($million) Internal rate of return (IRR) 4.00 2.00 (3.00) (0.20) (3.00) (0.20) (0.08) (0.12) 3.00 (0.40) (2.00) 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 (0.60) 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 2020 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 2021 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 10.00 3.50 (7.50) (0.50) (3.00) 2.50 1.00 1.50 3.00 0.00 (16.00) 1.00 1.08 6.58 0.48 3.90 4.50 4.50 4.50 (16.00) 2.30 11.07%
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