Discuss the below:
Q: Modify Acron's model so that development lasts for an extra year. Specifically, assume that development costs of $7.2 million and $2.1 million are incurred at the beginnings of years 1 and 2, and then the sales in the current model occur one year later, that is from year two until year 21. Again, calculate the negative predictive value (NPV) discounted back to the beginning of year 1, and perform the same sensitivity analyses. What are some of the effects of this change in timing?
Attachment:- Sensitivity to years.rar