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2. Blooper's analysts have come up with the following revised estimates for its magnoosium mine: Initial Investment Revenues Variable costs, % of revenues Fixed costs Working capital, % of expected value Range Pessimistic Optimistic +50% -25% -15% +20% +10% -10% +50% -30% +50% -50% a. Note that in this project analysis section the $10,000 initial expenses have been broken down into variable and fixed components. The variable costs are calculated as 40.0% of revenues. The initial fixed costs are 4,000 (5 thousands) and fixed costs grow according to the inflation rate. In the fourth tab, recreate the project valuation analysis you did in part 1A using separated out expense components. Hint: your cash flows and project valuation should not change. b. In the fifth tab of your spreadsheet, conduct a sensitivity analysis using the revised data estimating the Project NPV using the pessimistic, expected, and optimistic values. The most ambitious groups will conduct this sensitivity analysis in a dynamic way that resembles the second tab of the Blooper Industries Project Analysis spreadsheet posted to Moodle. In that spreadsheet, one can adjust the estimates and the associated NPV automatically update. Less ambitious groups will conduct this sensitivity analysis in a static way that only returns the NPV for the ranges specified above. Groups will be awarded points according to their accuracy and ambition c. In the fifth tab of your spreadsheet, recreate the tomado diagram for the Blooper project using the NPVs generated from your analysis in part 28. The most ambitious groups will recreate the tornado diagram in a dynamic way that resembles the second tab of the Blooper Industries Project Analysis spreadsheet posted to Moodle. In that spreadsheet, the tomado diagram automatically adjusts according to forecast variable changes Less ambitious groups will recreate the tomado diagram in a static way that is accurate for the ranges specified above. Groups will be awarded points according to their accuracy and ambition 2. Blooper's analysts have come up with the following revised estimates for its magnoosium mine: Initial Investment Revenues Variable costs, % of revenues Fixed costs Working capital, % of expected value Range Pessimistic Optimistic +50% -25% -15% +20% +10% -10% +50% -30% +50% -50% a. Note that in this project analysis section the $10,000 initial expenses have been broken down into variable and fixed components. The variable costs are calculated as 40.0% of revenues. The initial fixed costs are 4,000 (5 thousands) and fixed costs grow according to the inflation rate. In the fourth tab, recreate the project valuation analysis you did in part 1A using separated out expense components. Hint: your cash flows and project valuation should not change. b. In the fifth tab of your spreadsheet, conduct a sensitivity analysis using the revised data estimating the Project NPV using the pessimistic, expected, and optimistic values. The most ambitious groups will conduct this sensitivity analysis in a dynamic way that resembles the second tab of the Blooper Industries Project Analysis spreadsheet posted to Moodle. In that spreadsheet, one can adjust the estimates and the associated NPV automatically update. Less ambitious groups will conduct this sensitivity analysis in a static way that only returns the NPV for the ranges specified above. Groups will be awarded points according to their accuracy and ambition c. In the fifth tab of your spreadsheet, recreate the tomado diagram for the Blooper project using the NPVs generated from your analysis in part 28. The most ambitious groups will recreate the tornado diagram in a dynamic way that resembles the second tab of the Blooper Industries Project Analysis spreadsheet posted to Moodle. In that spreadsheet, the tomado diagram automatically adjusts according to forecast variable changes Less ambitious groups will recreate the tomado diagram in a static way that is accurate for the ranges specified above. Groups will be awarded points according to their accuracy and ambition

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