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We are evaluating a project that costs $750,000, has an fourteen-year life, and has no salvage value. Assume that depreciation is straight-line to zero over
We are evaluating a project that costs $750,000, has an fourteen-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 114,000 units per year. Price per unit is $41, variable cost per unit is $24, and fixed costs are $750,750 per year. The tax rate is 34 percent, and we require a 17 percent return on this project. The projections given for price, quantity, variable costs, and fixed costs are all accurate to within +/- 12 percent Required: (a)Calculate the best-case NPV. (Do not round your intermediate calculations.) (Click to select) (b)Calculate the worst-case NPV. (Do not round your intermediate calculations.) (Click to select)
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