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Please answer both a & b. Thanks!! We are evaluating a project that costs $795,000, has a life of twelve years, and has no salvage
Please answer both a & b. Thanks!!
We are evaluating a project that costs $795,000, has a life of twelve years, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 114,000 units per year. Price per unit is $45, variable cost per unit is $21, and fixed costs are $803,745 per year. The tax rate is 24 percent, and we require a return of 20 percent on this project. The projections given for price, quantity, variable costs, and fixed costs are all accurate to within +/- 15 percent. a. Calculate the best-case NPV. b. Calculate the worst-case NPVStep by Step Solution
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