Week 4 Practice Set Information: If you have not already reviewed the video demonstrating the NPV calculation for Ford's Electric Truck project (in the course), please do so before attempting this project. Please open the Excel spreadsheet and enter these given data in the appropriate fields. Then complete the calculations in the yellow fields to eventually calculate the net present value and price per share impact. Good Luck. Project information: XXX Motors is evaluating a large investment into a self-driving/ safety project. Relevant costs and benefits are listed below - remember that some of these are inflows and others are outflows of cash: Cost to develop the technology $8,000,000,000. Additional revenue per vehicle sold $1200. Number of cars sold with this feature 2,000,000. Fixed Cost to update the technology $100,000,000. Variable cost of installation per vehicle $100 Amortization of the cost to develop the technology $80,000,000. Tax rate 28% Disposition value of technology $0 Weighted average cost of capital 8.00% Number of shares outstanding 500,000,000.

X AutoSave On Week 4 Practice Set -- calculating NPV . Saved v 9 Search mike ziegenhals MZ O X File Home Insert Draw Page Layout Formulas Data Review View Help Comments Share ~ Calibri * 17 ~ A " A " = = =] de Wrap Text General AutoSum AY O Past BIU FDA Merge & Center $ % " Conditional Format as Cell Fill 00 Insert Delete Format Sort & Find & Add-ins Analyze Formatting Table Styles v Clear Filter ~ Select v Data Clipboard Font Alignment Number Styles Cells Editing Add-ins R22 VIX fx C D G M Net present value -- Week 4 -- Practice Set: Acquisition stage cash flow: Cost of developing the automated technology (in millions of dollars) Operating stage cash flow: Year 0 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 6 Number of units sold with this feature (not in millions) Premium charge per vehicle All amounts below are in millions 9 Sales (in millions) $ $ - $ - $ - $ - $ - $ 10 Fixed Cost of updating the technology 11 Variable Cost of installing the technology 12 Amortization of the development costs 3 Taxable income Taxes at 28% $ - $ - $ - $ - $ 5 After tax income 6 Add back amortization $ - S - $ - $ $ - 5 - 5 - 5 - 5 - 5 17 Operating cash flows 18 19 Disposition stage cash flow: $ 21 Total cash flow 22 Present Value Net Present Value Number of share of common stock outstanding Expected increase in value per share 23 Sheet1 Ready Accessibility: Good to go 79% 1 85.F Windy Q Search 5:43 PM 6/26/2024