1996 1997 1998 1999

Year 0 1 2 3
Market Demand 53750 61,000 71050 81700
Sales Volume - 0 0 75,000
Sale
LandPrice 1,675.00 1,574.50 1,480.03 1,391.23
(4,000,000.00)
R & D expense (6,000,000.00) (1,200,000.00) (1,200,000.00) (1,200,000.00)
Building cost (10,000,000.00)
Equipment cost (15,000,000.00)
Investment tax credit
Working capital 31,302,634.50 62,605,269.00
Total Capital (10,000,000.00) (26,200,000.00) 30,102,634.50 61,405,269.00

Sales Revenue - - - 104,342,115.00

Total Variable Cost - - - (62,605,269.00)
Fixed Oper. Cost (10,000,000.00)
Depreciation - Plant (900,000.00)
Depreciation - Equip. (1,350,000.00) (1,350,000.00) (1,200,000.00)
Operating Income - - - 29,636,846.00
Tax 13,632,949.16
Net Income 16,003,896.84
Total Deprecition 2,100,000.00
Operating Cash Flow 31,302,634.50
Capital Cash Flow
Total Cash Flow (10,000,000.00) (26,200,000.00) 30,102,634.50 (13,198,737.66)

DCF (10,000,000.00) (26,200,000.00) 30,102,634.50 (13,198,737.66)

NPV 136,489,715

WACC 11%
Land Cost 4,000,000.00
Land Terminal Value 6,000,000.00
Building Cost 10,000,000.00
Building B.V (End) 3,400,000.00
Equipment Cost 15,000,000.00
Production Capacity 75,000
Variable Cost 60.00%
Fixed Costs 10,000,000.00
Annual Increase (F.C) 4.00%
Tax Rate 46.00%
 1996 1997 1998 1999
Year 0 1 2 3
Market Demand 53750 61,000 71050 81700
Sales Volume - 0 0 75,000
Sale
LandPrice 1,675.00 1,574.50 1,480.03 1,391.23
(6,000,000.00)
R & D expense (6,000,000.00) (1,200,000.00) (1,200,000.00) (1,200,000.00)
Building cost (15,000,000.00)
Equipment cost (21,000,000.00)
Investment tax credit
Working capital 34,099,003.18 68,198,006.36
Total Capital (12,000,000.00) (37,200,000.00) 32,899,003.18 66,998,006.36

Sales Revenue - - - 113,663,343.94

Total Variable Cost - - - (68,198,006.36)
Fixed Oper. Cost 15,750,000.00
Depreciation - Plant (1,350,000.00)
Depreciation - Equip. (1,890,000.00) (1,890,000.00) (1,680,000.00)
Operating Income - - - 58,185,337.58
Tax 26,765,255.28
Net Income 31,420,082.29
Total Deprecition 3,030,000.00
Operating Cash Flow 34,099,003.18
Capital Cash Flow
Total Cash Flow (12,000,000.00) (37,200,000.00) 32,899,003.18 351,079.11

DCF (12,000,000.00) (37,200,000.00) 32,899,003.18 351,079.11

NPV 238,545,419

Land Cost 4,000,000.00

WACC 11%
Land Terminal Value 6,000,000.00
Building Cost 15,000,000.00
Building B.V (End) 3,400,000.00
Equipment Cost 15,000,000.00
Production Capacity 75,000
Variable Cost 60.00%
Fixed Costs 15,750,000.00
Annual Increase (F.C) 4.00%
Tax Rate 46.00%
 1996 1997 1998 1999
Year 0 1 2 3
Market Demand 53750 61,000 71050 81700
Sales Volume - 0 0 75,000
Sale
LandPrice 1,675.00 1,574.50 1,480.03 1,391.23
(2,000,000.00)
R & D expense (6,000,000.00) (1,200,000.00) (1,200,000.00) (1,200,000.00)
Building cost (8,000,000.00)
Equipment cost (12,000,000.00)
Investment tax credit
Working capital 31,302,634.50 62,605,269.00
Total Capital (8,000,000.00) (21,200,000.00) 30,102,634.50 61,405,269.00

Sales Revenue - - - 104,342,115.00

Total Variable Cost - - - (62,605,269.00)
Fixed Oper. Cost 7,500,000.00
Depreciation - Plant (720,000.00)
Depreciation - Equip. (1,080,000.00) (1,080,000.00) (960,000.00)
Operating Income - - - 47,556,846.00
Tax 21,876,149.16
Net Income 25,680,696.84
Total Deprecition 1,680,000.00
Operating Cash Flow 31,302,634.50
Capital Cash Flow
Total Cash Flow (8,000,000.00) (21,200,000.00) 30,102,634.50 (3,941,937.66)

DCF (8,000,000.00) (21,200,000.00) 30,102,634.50 (3,941,937.66)

NPV 168,203,859

Land Cost 2,000,000.00

WACC 11%
Land Terminal Value 6,000,000.00
Building Cost 8,000,000.00
Building B.V (End) 3,400,000.00
Equipment Cost 12,000,000.00
Production Capacity 75,000
Variable Cost 70.00%
Fixed Costs 15,750,000.00
Annual Increase (F.C) 4.00%
Tax Rate 46.00%
 Smaller Plant
2000 2001 2002 2003 2004
4 5 6 7 8
93950 108000 124000 142800 164200
75,000 75,000 75,000 75,000 75,000
1,307.75 1,229.29 1,155.53 1,086.20 1,021.03

(1,200,000.00) (1,200,000.00)

60,727,110.93 58,961,642.34 57,302,101.87 55,742,133.83 54,275,763.87

59,527,110.93 57,761,642.34 57,302,101.87 55,742,133.83 54,275,763.87

98,081,588.10 92,196,692.81 86,664,891.25 81,464,997.77 76,577,097.90

58,848,952.86 55,318,015.69 51,998,934.75 48,878,998.66 45,946,258.74
(10,000,000.00) (10,000,000.00) (10,000,000.00) (10,000,000.00) (10,000,000.00)
(900,000.00) (800,000.00) (700,000.00) (700,000.00) (600,000.00)
(1,050,000.00) (1,050,000.00) (900,000.00) (750,000.00) (750,000.00)
144,980,540.96 135,664,708.50 127,063,825.99 118,893,996.43 111,173,356.65
66,691,048.84 62,405,765.91 58,449,359.96 54,691,238.36 51,139,744.06
78,289,492.12 73,258,942.59 68,614,466.04 64,202,758.07 60,033,612.59
1,950,000.00 1,850,000.00 1,600,000.00 1,450,000.00 1,350,000.00
(1,878,158.07) (1,765,468.59) (1,659,540.47) (1,559,968.04) (1,466,369.96)

82,117,650.19 76,874,411.18 71,874,006.51 67,212,726.12 62,849,982.55

82,117,650.19 76,874,411.18 71,874,006.51 67,212,726.12 62,849,982.55

 Bigger Plant
2000 2001 2002 2003 2004
4 5 6 7 8
93950 108000 124000 142800 164200
75,000 75,000 75,000 75,000 75,000
1,307.75 1,229.29 1,155.53 1,086.20 1,021.03

(1,200,000.00) (1,200,000.00)

70,958,063.99 73,927,974.48 77,084,789.24 80,631,809.91 84,394,841.09

69,758,063.99 72,727,974.48 77,084,789.24 80,631,809.91 84,394,841.09

122,863,536.03 132,763,237.65 143,285,953.53 155,109,355.75 167,652,793.01

73,718,121.62 79,657,942.59 85,971,572.12 93,065,613.45 100,591,675.81
15,750,000.00 15,750,000.00 15,750,000.00 15,750,000.00 15,750,000.00
(1,350,000.00) (1,200,000.00) (1,050,000.00) (1,050,000.00) (900,000.00)
(1,470,000.00) (1,470,000.00) (1,260,000.00) (1,050,000.00) (1,050,000.00)
209,511,657.64 225,501,180.24 242,697,525.64 261,824,969.21 282,044,468.82
96,375,362.52 103,730,542.91 111,640,861.79 120,439,485.84 129,740,455.66
113,136,295.13 121,770,637.33 131,056,663.85 141,385,483.37 152,304,013.16
2,820,000.00 2,670,000.00 2,310,000.00 2,100,000.00 1,950,000.00
2,760,057.63 2,969,910.49 3,156,814.76 3,547,020.67 3,763,031.18

113,196,237.50 121,470,726.84 130,209,849.08 139,938,462.70 150,490,981.99

113,196,237.50 121,470,726.84 130,209,849.08 139,938,462.70 150,490,981.99

 Buy the plant
2000 2001 2002 2003 2004
4 5 6 7 8
93950 108000 124000 142800 164200
75,000 75,000 75,000 75,000 75,000
1,307.75 1,229.29 1,155.53 1,086.20 1,021.03

(1,200,000.00) (1,200,000.00)

60,727,110.93 58,961,642.34 57,302,101.87 55,742,133.83 54,275,763.87

59,527,110.93 57,761,642.34 57,302,101.87 55,742,133.83 54,275,763.87

98,081,588.10 92,196,692.81 86,664,891.25 81,464,997.77 76,577,097.90

58,848,952.86 55,318,015.69 51,998,934.75 48,878,998.66 45,946,258.74
7,800,000.00 8,112,000.00 8,436,480.00 8,773,939.20 9,124,896.77
(720,000.00) (640,000.00) (560,000.00) (480,000.00) (400,000.00)
(840,000.00) (840,000.00) (720,000.00) (600,000.00) (600,000.00)
163,170,540.96 154,146,708.50 145,820,305.99 138,037,935.63 130,648,253.41
75,058,448.84 70,907,485.91 67,077,340.76 63,497,450.39 60,098,196.57
88,112,092.12 83,239,222.59 78,742,965.24 74,540,485.24 70,550,056.84
1,560,000.00 1,480,000.00 1,280,000.00 1,080,000.00 1,000,000.00
(1,878,158.07) (1,765,468.59) (1,659,540.47) (1,559,968.04) (1,466,369.96)

91,550,250.19 86,484,691.18 81,682,505.71 77,180,453.28 73,016,426.80

91,550,250.19 86,484,691.18 81,682,505.71 77,180,453.28 73,016,426.80

 2005 2006 2007 2008
9 10 11 12
188820 217150 249700
75,000 75,000 75,000 75,000
959.77 902.18 848.05 797.17
6,000,000.00

3,400,000.00

52,897,376.11 51,601,691.61 50,383,748.19 49,238,881.36

52,897,376.11 51,601,691.61 50,383,748.19 58,638,881.36

71,982,472.03 67,663,523.71 63,603,712.29 59,787,489.55

43,189,483.22 40,598,114.22 38,162,227.37 35,872,493.73
(10,000,000.00) (10,000,000.00) (10,000,000.00) (10,000,000.00)
(500,000.00) (500,000.00) (500,000.00) (500,000.00)
(750,000.00) (750,000.00) (750,000.00) (750,000.00)
103,921,955.25 97,011,637.93 90,515,939.66 84,409,983.28
47,804,099.41 44,625,353.45 41,637,332.24 38,828,592.31
56,117,855.83 52,386,284.48 48,878,607.41 45,581,390.97
1,250,000.00 1,250,000.00 1,250,000.00 1,250,000.00
(1,378,387.76) (1,295,684.50) (1,217,943.43) (1,144,866.82)

58,746,243.60 54,931,968.98 51,346,550.84 47,976,257.79

58,746,243.60 54,931,968.98 51,346,550.84 47,976,257.79

 2005 2006 2007 2008
9 10 11 12
188820 217150 249700
75,000 75,000 75,000 75,000
959.77 902.18 848.05 797.17
15,000,000.00

15,000,000.00

88,465,924.66 92,871,539.87 97,626,391.01 34,099,003.18

88,465,924.66 92,871,539.87 97,626,391.01 64,099,003.18

181,223,071.58 195,908,455.64 211,757,959.44 -

108,733,842.95 117,545,073.39 127,054,775.66 -
15,750,000.00 15,750,000.00 15,750,000.00 15,750,000.00
(750,000.00) (750,000.00) (750,000.00) (750,000.00)
(1,050,000.00) (1,050,000.00) (1,050,000.00) (1,050,000.00)
303,906,914.53 327,403,529.03 352,762,735.10 13,950,000.00
139,797,180.68 150,605,623.35 162,270,858.15 6,417,000.00
164,109,733.85 176,797,905.68 190,491,876.95 7,533,000.00
1,800,000.00 1,800,000.00 1,800,000.00 1,800,000.00
4,071,083.57 4,405,615.22 4,754,851.14 (63,527,387.83)

161,838,650.28 174,192,290.46 187,537,025.82 72,860,387.83

161,838,650.28 174,192,290.46 187,537,025.82 72,860,387.83

 2005 2006 2007 2008
9 10 11 12
188820 217150 249700 0
75,000 75,000 75,000 75,000
959.77 902.18 848.05 797.17

12,000,000.00

52,897,376.11 51,601,691.61 50,383,748.19 49,238,881.36

52,897,376.11 51,601,691.61 50,383,748.19 61,238,881.36

71,982,472.03 67,663,523.71 63,603,712.29 59,787,489.55

43,189,483.22 40,598,114.22 38,162,227.37 35,872,493.73
9,489,892.64 9,869,488.34 10,264,267.88 10,674,838.59
(400,000.00) (400,000.00) (400,000.00) (400,000.00)
(600,000.00) (600,000.00) (600,000.00) (600,000.00)
123,661,847.89 117,131,126.28 111,030,207.54 105,334,821.87
56,884,450.03 53,880,318.09 51,073,895.47 48,454,018.06
66,777,397.86 63,250,808.19 59,956,312.07 56,880,803.81
1,000,000.00 1,000,000.00 1,000,000.00 1,000,000.00
(1,378,387.76) (1,295,684.50) (1,217,943.43) (1,144,866.82)

69,155,785.62 65,546,492.69 62,174,255.50 59,025,670.63

69,155,785.62 65,546,492.69 62,174,255.50 59,025,670.63