Question
Consider a project with the following information: Initial fixed asset investment = $500,000; straight-line depreciation to zero over the 4-year life; zero salvage value; price
Consider a project with the following information: Initial fixed asset investment = $500,000; straight-line depreciation to zero over the 4-year life; zero salvage value; price = $35; variable costs = $26; fixed costs = $200,000; quantity sold = 80,000 units; tax rate = 25 percent. How sensitive is OCF to changes in quantity sold?
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Economics Of Money Banking And Financial Markets
Authors: Frederic S. Mishkin
6th Edition
0321113624, 978-0321113627
