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Ragu's Company estimates that their products can be sold for an average price of $ 5 0 per unit, and the company analysts expect that

Ragu's Company estimates that their products can be sold for an average price of $50 per unit, and the company analysts expect that the firm can sell 300,000 units per year at this price for a period of five years. Ragu's companys management has determined that it will be possible to reduce the variable cost per unit down to $22 per unit by purchasing an additional option for the equipment that will raise its initial cost to $.2.4 million (the residual or salvage value for this configuration is estimated to be $.400,000). The cash fixed cost per year is $600,000. In addition, the firm expects to have to invest an additional $700,000 in working capital to support the new business. The tax rate is 30% and the discount rate is 12%.
Calculate NPV and IRR for the above scenario using MS Excel
consider the following changes:
Unit sales (10%)
Price per unit (10%)
Variable cost per unit (+10%)
Cash fixed costs per year (+10%)
For the above changes, analyze the sensitivity of the project NPV using MS Excel.

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