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Please find the following answers and show work Project Evaluation & Capital Investment Volume Price Marginal Cost Expected Life of Project Fixed Costs Capital requirement
Please find the following answers and show work
Project Evaluation & Capital Investment Volume Price Marginal Cost Expected Life of Project Fixed Costs Capital requirement Market value of equipment in 3 years Charge to Net Working Capital Tax rate: Risk free rate (3-year) Total Market Return Project Beta Project Debt/Equity Structure Cost of Debt (pretax) 52,000 units 57.000 units-61.000 units $4.50 per unit $4.25 per unit--$3.85 per unit $3.25 per unit--$2.50 per unit--$2.20 per unit 3 years $14,000 per year $100,000 (90% depreciated over the 3-year span) $10,000 $30,000 (at t- 0, then recapture at t- 3) 34% 2.5% 9.95% 2.30 0.70 5.5%Step by Step Solution
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