You are considering a new product launch. I he project will cost $$1,5b,UU,$ have a $4-$year lite, and have no salvage value;

depreciation is straight$-$line to $0.$ Sales are projected at $150$ units per year; price per unit will be $$19,000$; variable cost per unit will be

$$11,000$; and fixed costs will be $$460,000$ per year. The required return on the project is $12\%,$ and the relevant tax rate is $35\%.$

a$.$ Based on your experience, you think the unit sales, variable cost, and fixed cost projections given here are probably accurate to

within $+-10\%.$ What are the upper and lower bounds for these projections? What is the base$-$case NPV$?$ What are the best$-$case and

worst$-$case scenarios? $($Negative answers should be indicated by a minus sign. Do not round intermediate calculations. Round the

final NPV answers to $2$ decimal places. Omit $ sign in your response.$)$

b$.$ Evaluate the sensitivity of your base$-$case NPV to changes in fixed costs. $($Negative answers should be indicated by a minus sign.

Do not round intermediate calculations. Round the final answer to $3$ decimal places. Omit $ sign in your response.$)$

$NP\frac{V}{}FC,$$

c$.$ What is the cash break$-$even level of output for this project $($ignoring taxes$)?($Round the final answers to the nearest whole unit.$)$

Cash break$-$even

units

d$-1.$ What is the accounting break$-$even level of output for this project? $($Round the final answers to the nearest whole unit.$)$

Accounting break$-$even

units

d$-2.$ What is the degree of operating leverage at the accounting break$-$even point? $($Round the final answer to $4$ decimal places.$)$

Deqree of operating leveraqe