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Urgent solution handwritten. 3- You are considering a new product launch in Thailand. The project will cost 120,000 baths, have a four year life, and
Urgent solution handwritten.
3- You are considering a new product launch in Thailand. The project will cost 120,000 baths, have a four year life, and have no salvage value; depreciation is straight line to zero. Sales are projected at 195 units per year; price per year will be 6,300 baths, variable cost per unit will be 4,500 baths, and fixed costs will be 30,000 baths per year. The required return on the project is 20%, and the relevant tax rate is 25 %. a) Based on your experience, you think the quantity and variable cost projections given here are probably accurate to within +/- 10%? What is the worst case senarios and NPV? b) Ignoring the effect of taxes, what is the financial break-even level output for base year? How do you interpret your resultStep by Step Solution
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