有哪位高手能够帮忙解答一下下面的问题，万分感谢！
AlliedProducts Capital Budget（AlliedProducts公司资金预算）
AlliedProducts Inc., has recently won approval from the federal aviation administration (FAA) for its enhanced ground proximity warning system (GPWS). This system is designed to give airplane pilots additional warning of approaching ground danger and thus help prevent crashes. AlliedProducts has spent $10 million in research and development the past four years developing GPWS. The GPWS will be put on the market beginning this year and allied products expects it to stay on the market for a total of five years.
As a financial analyst specializing in the aerospace industry for USC pension & investment， Inc., you are asked by your managing director, Mr. Adam Smith, to evaluate the potential of this new GPWS project.
Initially, AlliedProducts will need to acquire $42 million in production equipment to make the GPWS. The equipment is expected to have a seven-year useful life. This equipment can be sold for $12 million at the end of five years（pre-tax）. AlliedProducts intends to sell two different versions of the GPWS:
* New GPWS------- intended for installment in new aircraft. The selling price is $70.000 per system. and variable cost of production is $50.000 per system. (assume cash flows occur at year-end)
* Upgraded GPWS------ intended for installment on existing aircraft with older version ground proximity radar in place. The selling price of the upgrade system is $35.000 per system and the variable cost to produce it is $22.000 per system
AlliedProducts intends to raise prices at the same rate as inflation. Variable costs will also increase with inflation. In addition, the GPWS project will also incur $3 million in marketing and general administration costs at the first year. (expected to increase at the same rate as inflation)
AlliedProducts’ corporate tax rate is 40%. Assume that the equity beta is the best estimate of AlliedProducts’ beta and the beta is 1.2. A five-year US treasury bond has a rate of 6.20% and the S&P 500 recent years’ historical average excess return (i.e. the market return less the treasure bond rate) is 8.3%.
Annual inflation is expected to remain constant at 3%. Further, suppose AlliedProducts’ cost of debt is 6.2% and its debt-to-equity ratio is 50% and will remain at this rate for at least five years.
Commercial aircraft market
The state of the economy has a major impact on the airplane manufacturing industry. Airline industry analysts have the following production expectation, depending on the annual state of the economy for the next five years.
Table 1
State of economy Probability of state New aircraft (year 1) Annual growth
Strong growth 0.15 350 0.15
Moderate growth 0.45 250 0.10
Mild recession 0.30 150 0.06
Severe recession 0.10 50 0.03
While probabilities of each state of the economy will not change during the next five years, airplane production for each category will increase, as shown in table 1. Each year after year 1, the FAA requires that these planes have new ground proximity warning systems, of which there are a number of manufacturers besides AlliedProducts.
AlliedProducts estimates that there are approximately 12,500 existing aircraft that compromise the market for its GPWS upgraded ground package. Due to FAA regulations, all existing aircraft will be required to get an upgraded ground proximity warning system within the next five years, again, not necessarily from AlliedProducts. AlliedProducts believes the upgrades of the existing aircraft fleet will be spread evenly over the five years (the time value of money would suggest manufacturers defer purchasing upgrades until the fifth year; however, consumer demand for the additional safety will induce earlier upgrades)
AlliedProducts uses the MACRS depreciation schedule（seven-year property class）. The immediate initial working capital requirement is $2million and thereafter the net working capital requirements will be 5% of sales(assume to recover by the end of year 5).
AlliedProducts has a number of competitors both in the new GPWS and upgrades GPWS markets, but expects to dominate the market within a 45% share.
Assignment
* Use the CAPM to determine the appropriate discount rate for this product.
* Then use computer spreadsheets such as Excel to analyze the project.
* Will the GPWS project improve the wealth of AlliedProducts’ shareholders?
* now Assume (1) market share decrease 10% (2) product price decline 10% and (3) variable cost increase 10% respectively due to the fierce compitition happened at the end of 3rd year. Please answer the question of 3.
Please note that the assignment will be assessed according to the requirement of BTEC and grading strictly based on students’ efforts input, skill & technique performance and other significant factors.
Please also note that the assignment is based on individual efforts.
Also bear in mind that the deadline for the first draft of assignment is 2nd December 2008.
联产有限公司最近得到联邦航空管理局的许可，生产增强型近地警报系统（GPWS）。这个系统能够向飞行员警告触地险情，以防撞地。联产公司在过去的4年里为GPWS投入了1000万美元的研发费用，今年将开始投入市场，该产品期望寿命周期为5年。
假设你是USC养老金及投资公司的专门研究航空行业的一个财务分析人员，受上司委托，评估这个新的GPWS项目的潜力。
首先需要4200万美元投资于GPWS的生产设备，这种设备的寿命预计为7年，若5年之后售出，可得到1200万美元。联产公司打算推出两种形式的GPWS：
* 新型GPWS。安装到新机上。每套系统售价是70000美元，生产的变动成本是50000美元（假设现金流量发生在年末）
* 改进型GPWS。安装到现在已安装旧式近地雷达的飞机上。每套系统是35000美元，生产的变动是22000美元。
联产公司打算按通货膨胀率调整价格，变动成本也将随通货膨胀而增长，另外，GPWS项目在第一年还要发生300万美元的营销费用和一般管理费用。
联产公司的所得税税率为40%，假设贝塔系数是1.2，美国5年期国库券利率为6.2%，S&P500最近几年的平均超额收益率（即市场收益率减去国库券利率）为8.3%。年通货膨胀率保持在3%水平上，另外，联产公司的债务资本成本是6.2%。此外，负债权益比为50%，而且至少5年保持不变（尽管这可能有点不现实）。
商用飞机市场
经济发展状况对飞机制造业有重大影响，航空行业的分析人员根据未来5年中各年的经济发展状况作出以下生产预测：
经济状况 概率 新飞机（第一年） 年增长率
强劲增长 0.15 350 0.15
中等增长 0.45 250 0.10
略有衰退 0.30 150 0.06
严重衰退 0.10 50 0.03
由于未来五年中经济状况的发生概率保持不变，每种飞机的生产都将按表所示的增长率增长。FAA要求这些飞机都安装新的近地报警系统，而产生GPWS的厂商除了联产公司之外还有许多家。
联产公司估计约有12500架现有的飞机需要安装改进型。按照规定，所有这些飞机都必须在5年内安装一个改进型近地警报系统。同样，这种系统的厂家也不止一家。联产公司认为，现有飞机改进业务将在未来5年内等额分摊（货币时间价值的存在使得飞机制造商希望将购买改进型警报系统推迟到第5年，而用户则要求更高的安全保障，这又使得改进需要较早进行）。
为GPWS投资的设备按7年期财产进行折旧。营运资本起初是200万美元，以后所需的净营运资本将是销售收入的5%。
无论在新型GWPS市场还是在改进型市场，都有众多竞争对手，但它有望以45%的份额在市场中占主导地位。
问题：
* 运用CAPM为该项目确定合适的折现率。
* 分析这个项目。
* 这个项目能使股东的财富增加吗？
* 假设（1）市场份额减少10%，（2）产品价格减少10%，（3）可变成本增加10%，在最后三年。请分别分析这三种情况。