Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

. Question 3 5 out of 5 points Find the financial break even given the following information: Project Initial Outlay is $5,000 with straight line

image text in transcribed

. Question 3 5 out of 5 points Find the financial break even given the following information: Project Initial Outlay is $5,000 with straight line depreciation; Project Life = 5 Years; Discount Rate = 10 %. Total Production Costs = FC + VC = $15,000 Per Year, Variable Costs = $2 per unit; Unit Sales = 4,000 units, Price = $5 per unit, and Ignore Taxes. Selected Answer: 2,773 Units Correct Answer: . 2,773 Units Question 4 3 out of 5 points A project requires an initial investment of $5,000, straight-line depreciable to zero over 5 years. The discount rate is 12%. Your tax bracket is 35% and you receive a tax credit for negative earnings in the year in which the loss occurs. Additional information for variables with forecast errors are shown below. Base Lower Upper case bound bound Unit sales 2,000 1,200 2,800 Price/unit $15 $13 $17 Variable $10 $8 cost/unit $12 Fixed costs $4,000 $3,250 $4,750 What is the worst case NPV for the project? Selected Answer: -$12,056 Correct Answer: -$12,056

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Crisis Labour Markets And Institutions

Authors: Sebastiano Fadda

1st Edition

1138901822,1136268502

More Books

Students also viewed these Finance questions