Prepare a table in Excel to compute the net present value for Proposal A and consider this the likely scenario. Next, prepare an optimistic and pessimistic scenario. For the optimistic scenario, increase each cash inflow by 10% and for the pessimistic scenario, decrease each net cash inflow by 10%. Note: Round your answers to the nearest whole dollar. Use a negative sign to indicate a cash outflow.

	Proposal A
Initial investment	$100,000
Cash flow from operations
Year 1	60,000
Year 2	40,000
Year 3	35,000
Disinvestment	-
Life (years)	3
Discount rate (for all proposals)	12%

a.  

	Proposal A	Proposal A	Proposal A
	Likely	Optimistic	Pessimistic
Initial investment	Answer	Answer	Answer
Year 1	Answer	Answer	Answer
Year 2	Answer	Answer	Answer
Year 3	Answer	Answer	Answer
Net present value

b. Prepare a bar chart showing the net present value for the likely, optimistic, and pessimistic scenarios. c. Using the chart in part b, answer the following questions. 1. Indicate whether any of the three scenarios meet the screening test based on net present value.

Likely scenario	yes/no
Optimistic scenario	yes/no
Pessimistic scenario	yes/no

2. Would you recommend that the company move forward with proposal A? If the cash flows in the proposal are underestimated by no more than 10%, the company risks earning a return of Answer