Mundar Mandir Berhad is considering a new project. The cost for this project is RM750,000, has a five-year life, and has no salvage value. Depreciation is straight-line to zero. The required rate of return is 17%, and the tax rate is 35%. Sales are projected at 500 units per year. Selling price per unit is RM2,500, variable cost per unit is RMI ,500 and fixed cost are RM200,OOO per year.

Mundar Mandir Berhad think that the unit sales, selling price, variable cost, and fixed cost projections are accurate to within 5%.

From the above information you are required to answer the following questions

1. Determine the upper and lower bounds for this projection. (5 Marks)
2. Based on your answer in part (a), prepare the Cash Flows Analysis clearly showing the Net Present Value (NPV) for the best and worst-case scenario. (10 Marks)
3. c. Based on the NPV in part (b), interpret your findings. (5 Marks)