ork: Chapter $13$ Homework

Question $1,$ Pis$-1($similar to$)$

HW Score: $0\%,0$ of $9$ points

Part $1$ of $7$

Points: $0$ of $6$

Savo

will have to invest an additional $$301,000$ in working capital to support the new business. Other pertinent information concerning the business venture is provided here: $.$

a$.$ Calculate the project's NPV$.$

b$.$ Determine the sensitivity of the project's NPV to a$($n$)8$ percent decrease in the number of units sold.

c$.$ Determine the sensitivity of the project's NPV to a $(n)8$ percent decrease in the price per unit.

d$.$ Determine the sensitivity of the project's NPV to a$($n$)8$ percent increase in the variable cost per unit

e$.$ Determine the sensitivity of the project's NPV to a $(n)8$ percent increase in the annual fixed operating costs.

f$.$ Use scenario analysis to evaluate the project's NPV under worst$-$ and best$-$case scenarios for the project's value drivers. The values for the expected or base$-$case along with the worst$-$and best$-$case scenarios are listed here:

a$.$ The NPV for the base$-$case will be $($Round to the nearest dollar.$)$

Data table

$\backslash$table$[[,$Expected or Base Case,Worst Case,Best Case$],[$Unit sales,$106,000,76,320,135,680],[$Price per unit,$$96,$$$86\mathrm{.}40,\backslash$table$[[$$$116\mathrm{.}16,]]],[$Variable cost per unit,$$(22),$$$(23\mathrm{.}98),\backslash$table$[[$$$(19\mathrm{.}80)$