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You want to evaluate a project with a cost of USD $ 1,000,000, a life of eight years and no rescue value at the endo

You want to evaluate a project with a cost of USD $ 1,000,000, a life of eight years and no rescue value at the endo of the project. Assume straight line depreciation over the life of the project. Sales forecast consider 80,000 units per year with unit price of USD $ 40, the variable cost per unit is USD $ 25, and the fixed costs are USD $ 700,000 per year. The corporate tax rate is 35% and a the required return for this project is15% a) Calculate accounting break-even point b) Calculate cash flow and project's NPV. What is the NPV sensitivity for changes in sales Explain your answer if there are 500 less units c) Cul es la sensibilidad del FEO a los cambios en la cifra de costo variable? Explain what your answer indicates if the estimated variable costs suffer a reduction of USD$.

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