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Question 2 (1 point) Below is the information associated with the expected sales of 10,000 units for a given project. Conduct a sensitivity analysis to
Question 2 (1 point) Below is the information associated with the expected sales of 10,000 units for a given project. Conduct a sensitivity analysis to calculate the NPV of the project if sales were 20% less than expected. What is the NPV for the lower sales? Cost Shipping Installation Salvage Value Econ Life 1 4 Depreciation 2 44.45% 3 14.81% 33.33% 7.41% Annual Unit Sales Price / Unit Cost / Unit Inflation Net Working Capital Tax Rate Project WACC Opportunity Cost (lease) Externalities (canibalism) $1,250,000 $50,000 $125,000 $100,000 4 Years MACRS Basis 3 Years $1,425,000 10,000 $200 $100 2% 15% (Sales-1) 40% 12% $75,000 $300,000 Sales $45,000 OCE $120,000 OCF $637,762 $285,719 - $66,324 -$7,651 Question 2 (1 point) Below is the information associated with the expected sales of 10,000 units for a given project. Conduct a sensitivity analysis to calculate the NPV of the project if sales were 20% less than expected. What is the NPV for the lower sales? Cost Shipping Installation Salvage Value Econ Life 1 4 Depreciation 2 44.45% 3 14.81% 33.33% 7.41% Annual Unit Sales Price / Unit Cost / Unit Inflation Net Working Capital Tax Rate Project WACC Opportunity Cost (lease) Externalities (canibalism) $1,250,000 $50,000 $125,000 $100,000 4 Years MACRS Basis 3 Years $1,425,000 10,000 $200 $100 2% 15% (Sales-1) 40% 12% $75,000 $300,000 Sales $45,000 OCE $120,000 OCF $637,762 $285,719 - $66,324 -$7,651
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