This is a retail company

Sensitivity Analysis Parameter Sales in Year 1 NPV Cost of Goods Sold NPV Inventory % of Next Year COGS NPV Sales Growth through Year 6 Initial Assumption Worst Case Best Case $27,000 $33,000 2,580 9,710 Answer: $30,000 6,145 72% 6,145 20% 6,145 6% 77% (1,390) 13,679 25% 4,966 67% 0% 15% 7,323 10% NPV 6,145 261 10,750 Question: Suppose you are the financial manager, if you are asked to use limited resources to refine the assumption on ONLY ONE of the above four parameters, which one should you choose and why? (fill in the blanks highlighted in yellow) Question: Why are the four assumptions you choose appropriate for your company? Answer: Sensitivity Analysis Parameter Sales in Year 1 NPV Cost of Goods Sold NPV Inventory % of Next Year COGS NPV Sales Growth through Year 6 Initial Assumption Worst Case Best Case $27,000 $33,000 2,580 9,710 Answer: $30,000 6,145 72% 6,145 20% 6,145 6% 77% (1,390) 13,679 25% 4,966 67% 0% 15% 7,323 10% NPV 6,145 261 10,750 Question: Suppose you are the financial manager, if you are asked to use limited resources to refine the assumption on ONLY ONE of the above four parameters, which one should you choose and why? (fill in the blanks highlighted in yellow) Question: Why are the four assumptions you choose appropriate for your company