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Scenario Analysis The most likely outcomes for a particular project are estimated as follows: Unit price: $ 5 0 Variable cost: $ 3 0 Fixed
Scenario Analysis
The most likely outcomes for a particular project are estimated as follows:
Unit price: $
Variable cost: $
Fixed cost: $
Expected Sales: units per year
However, you recognized that some of these estimates are subject to error. Suppose that each of the above variables may turn out to be either higher or lower than the estimate. The project will last for years and requires an initial investment of $ million. The firm's tax rate is and the required rate of return is What is the project NPV in the "bestcase" scenario that is assuming all variables take on the best possible value? What about the "worstcase" scenario?
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