Question

		EXHIBIT 9
		Sensitivity Analysis of Project IRR's by Price, Volume, Development Costs and Cost of Goods Sold
		Unit Volume
		(First 20 Years)		Price Premium
		15.66%	0%	5%	10%	15%
		1500	10.5%	10.9%	11.3%	11.7%
		1750	11.9%	12.3%	12.7%	13.1%
		2000	13.0%	13.5%	13.9%	14.4%
		2250	14.1%	14.6%	15.1%	15.5%
		2500	15.2%	15.7%	16.1%	16.6%
		2750	16.1%	16.6%	17.1%	17.6%
		3000	17.1%	17.6%	18.1%	18.6%
		Development
		Costs		COGS / Sales
		15.66%	78%	80%	82%	84%
		$6,000,000,000	21.3%	18.7%	15.9%	12.6%
		$7,000,000,000	19.4%	17.0%	14.4%	11.3%
		$8,000,000,000	17.9%	15.7%	13.2%	10.3%
		$9,000,000,000	16.6%	14.5%	12.1%	9.4%
		$10,000,000,000	15.5%	13.5%	11.2%	8.6%
	Note: The section below gives key assumptions driving the model--varying these assumptions, given in yellow, allows one to test the sensitivity of IRR.
	Average % deliveries of total to date of 757 and 767 For First 20 Years
	Year	% Deliveries	Year	%7E7	%7E7 Stretch
	1	1.19%	2008	100%	0%
	2	4.32%	2009	100%	0%
	3	2.54%	2010	80%	20%
	4	3.30%	2011	50%	50%	Year 4-30 (Need to modify Exhibit 8 spreadsheet construction if the 50% is changed)
	5	3.35%	2012
	6	4.16%	2013
	7	5.46%	2014
	8	4.76%	2015
	9	7.41%	2016
	10	7.68%	2017
	11	8.76%	2018
	12	6.59%	2019
	13	5.95%	2020
	14	4.32%	2021
	15	4.59%	2022
	16	4.76%	2023
	17	5.46%	2024
	18	6.00%	2025
	19	4.81%	2026
	20	4.59%	2027
	21-30	4.59%
	Deliveries in years 1-20			2500
	Deliveries in years 21-30			Same as year 20
	Development costs			$8,000,000,000
	Composition of development costs:
		Capital Expenditures		25%
		R&D		75%
	Timing of development costs			2004	2005	2006	2007	2008	2009
				5%	15%	50%	15%	10%	5%
	Minimum Price of 7E7 in 2002 U.S. $				120500000
	Minimum Price of 7E7 stretch in 2002 U.S. $				144500000
	Cheaper operating cost and other features price premium					5%
	Service Revenues
	Cost of goods sold			80%
	GSA percentage			7.5%
	R&D			2.3%
	Tax Expense			35%
	Capital Expenditures			0.16%
	Working capital % of sales			6.7%
	Inflation			2%
	Depreciation			150% declining balance 20 year, 0 salvage value. Calculations at bottom of exhibit 7

What does sensitivity analysis reveal about the nature of Boeing's gamble on the 7E7??