The case and our analysis focus on the Galvanized Pallet Nails (GPN) product line. Insteel

management conducted an activity-based costing exercise that led to product-line profitability

information as reported in Table 1 on Page 3 of the case. GPN are the product of choice within

the nail group in Table 1.

C. (30) Prepare a baseline estimate of the total financial value of making the investment in the

third GPN cell. Your analysis must include at least one DCFA table and at least one real

option valuation. Document your analysis carefully.