We are evaluating a project that costs $924,000, has a four-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 87,600 units per year. Price per unit is $34.55, variable cost per unit is $20.80, and fixed costs are $756,000 per year. The tax rate is 35 percent, and we require a return of 13 percent on this project.

Calculate the base-case operating cash flow and NPV.

If we use sales of 100,000 units, how much would the NPV be?

What is the sensitivity of NPV to changes in the sales figure?