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note that 900 bz is 0.900 and 1200 bz is 1.200 4. SALALAH LLC has project proposal for the production of Mats. The following scenarios

note that 900 bz is 0.900
and 1200 bz is 1.200 image text in transcribed
4. SALALAH LLC has project proposal for the production of Mats. The following scenarios are considered. Use the given information to calculate the NPV of two scenarios. (2.5+2.5 = 5 marks) Worst-Case Scenario Best-Case Scenario Sales Volume 800,000 units Sales Volume 1,300,000 units Sales Price 900bz Sales Price 1200bz Initial investment OMR 860,000 Initial investment OMR 780,000 Project life 3 years Project life 4 years Discount rate 17% Discount rate 14% Labour Cost OMR 176,000 Labour Cost OMR 247,000 Materials Cost OMR 360,000 Materials Cost OMR 494,000 Overhead Cost OMR 88.000/Overhead Cost OMR 117,000 The initial investment consists of investment in machines, which will have a zero (0) scrap value at the end of the four- year life of the project

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