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You manufacture face masks. Sales are projected at 15,500 face masks per year over the next four years. It will cost you 544,000 to install
You manufacture face masks. Sales are projected at 15,500 face masks per year over the next four years. It will cost you 544,000 to install the equipment necessary to start production: you'll depreciate this cost straight-line to zero over the project's life. You estimate that in four years. this equipment can be salvaged for $32,000. Your fixed production costs will be $65,000 per year, price per unit is $7. and your variable production costs should be $1.50 per unit (50.50 per unit in variable material costs and 51 per unit in variable labor expense). You also need an initial investment in net working capital of $90,000. You require a return of 9 percent on your investment. Ignore taxes (tax rate is 0%). You believe that estimates for units sales, unit price, unit variable costs and fixed costs are accurate only to within - +15 percent. What is the best case NPV
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