Question
ABC company is analyzing a new project with the following estimates: Lower Bound Expected Value Upper Bound Sales quantity 9,500 10,000 10,500 Sales price per
ABC company is analyzing a new project with the following estimates:
| Lower Bound | Expected Value | Upper Bound | |
| Sales quantity | 9,500 | 10,000 | 10,500 |
| Sales price per unit | $9.75 | $10.00 | $10.25 |
| Variable cost per unit | $4.80 | $5.20 | $5.60 |
| Fixed cost | $15.000.00 | $18,000.00 | $21,000.00 |
Initial requirement for equipment: $120,000 Depreciation: Straight-line to zero over the four-year life of the project with no salvage value. Required rate of return: 15% Marginal tax rate: 35% What is the net present value under the worst-case scenario?
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The Budget Building Book For Nonprofits
Authors: Murray Dropkin, Jim Halpin, Bill La Touche
2nd Edition
0787996033, 978-0787996031
