A project requires an initial investment of $10,000, straight-line depreciable to zero over 4 years. The discount rate is 10%. Your tax bracket is 34% and you receive a tax credit for negative earnings in the year in which the loss occurs. Additional information for variables with forecast error are shown below.

Base Case-

Unit Sales 3,000

Price/unit $14

Variable cost/unit $9

Fixed costs $9,000

12 What is the base case NPV for the project? A) $1,523 B) $4,974 C) $5,247 D) $6,529 E) $8,281