Question 1 10 pts Consider the following project. Your initial investment cost is $300 million, and that investment will depreciate in straight-line form over the 15-year life of the project. There are no new NWC requirements, and there will be no salvage value at the end of the 15 years. The tax rate is 26%. The discount rate is 12.5%. The risk-free rate is 3.31. The market risk premium is 8.98. In addition, the possible values for Market Share, Price/Unit, VC/Unit, and Fixed Costs are below. Pessimistic Expected Optimistic Market Size 900,000 1,027,287 1,100,000 Market Share 4.0% 4.6% 6.0% Price/unit $2350 $2542 $2570 VC/Unit $1900 $1256 $1100 FC $3.5 Million $1.9 Million $0.5 Million You will conduct a full sensitivity analysis for this project, and you will be asked for each of these answers in questions below. First, calculate the expected value of the project. Present the answer in millions of $ and round your answer to the nearest 0.01 (so if your answer is $5,511,000, answer 5.51) D Question 2 O pts Show your work for the NPV step calculation for the question about (for partial credit only) D Question 3 7 pts What is the project value from the sensitivity analysis using the pessimistic market size? Present the answer in millions of $ and round your answer to the nearest 0.01 (so if your answer is $5,511,000, answer 5.51) Question 1 10 pts Consider the following project. Your initial investment cost is $300 million, and that investment will depreciate in straight-line form over the 15-year life of the project. There are no new NWC requirements, and there will be no salvage value at the end of the 15 years. The tax rate is 26%. The discount rate is 12.5%. The risk-free rate is 3.31. The market risk premium is 8.98. In addition, the possible values for Market Share, Price/Unit, VC/Unit, and Fixed Costs are below. Pessimistic Expected Optimistic Market Size 900,000 1,027,287 1,100,000 Market Share 4.0% 4.6% 6.0% Price/unit $2350 $2542 $2570 VC/Unit $1900 $1256 $1100 FC $3.5 Million $1.9 Million $0.5 Million You will conduct a full sensitivity analysis for this project, and you will be asked for each of these answers in questions below. First, calculate the expected value of the project. Present the answer in millions of $ and round your answer to the nearest 0.01 (so if your answer is $5,511,000, answer 5.51) D Question 2 O pts Show your work for the NPV step calculation for the question about (for partial credit only) D Question 3 7 pts What is the project value from the sensitivity analysis using the pessimistic market size? Present the answer in millions of $ and round your answer to the nearest 0.01 (so if your answer is $5,511,000, answer 5.51)