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Emperor s Clothes Fashions can invest $ 6 million in a new plant for producing invisible makeup. The plant has an expected life of 5
Emperors Clothes Fashions can invest $ million in a new plant for producing invisible makeup. The plant has an expected life of years, and expected sales are million jars of makeup a year. Fixed costs are $ million a year, and variable costs are $ per jar. The product will be priced at $ per jar. The plant will be depreciated straightline over years to a salvage value of zero. The opportunity cost of capital is and the tax rate is What is project NPV under these basecase assumptions? What is NPV if variable costs turn out to be $ per jar? What is NPV if fixed costs turn out to be $ million per year? At what price per jar would the project's NPV equal zero?
Emperors Clothes Fashions can invest $ million in a new plant for producing invisible makeup. The plant has an expected life of years, and expected sales are million jars of makeup a year. Fixed costs are $ million a year, and variable costs are $ per jar. The product will be priced at $ per jar. The plant will be depreciated straightline over years to a salvage value of zero. The opportunity cost of capital is and the tax rate is
What is project NPV under these basecase assumptions?
What is NPV if variable costs turn out to be $ per jar?
What is NPV if fixed costs turn out to be $ million per year?
At what price per jar would the project's NPV equal zero?
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