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Problem 9-20 Sensitivity Analysis [LO 3] We are evaluating a project that costs $2.010.000, has a 7 -year life, and has no salvage value, Assume

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Problem 9-20 Sensitivity Analysis [LO 3] We are evaluating a project that costs $2.010.000, has a 7 -year life, and has no salvage value, Assume that depreciation is straight-line to zero over the life of the project. Soles are projected at 89.400 units per year. Price per unit is $38.61, variable cost per unit is $23.75, and fixed costs are $848,000 per year. The tax rate is 21 percent, and we require a return of 10 percent on this project. a. Calculate the base-cose operating cash flow and NPV. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. What is the sensitivity of NPV to changes in the sales figure? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) c. If there is a 350 -unit decrease in projected sales, how much would the NPV change? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) d. What is the sensitivity of OCF to changes in the variable cost figure? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to the nearest whole number, e.g. 32.) e. If there is a $1 decrease in estimated variable costs, how much would the OCF change? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)

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