We are evaluating a project that costs $104,299, has a seven-year life, and has no salvage...

We are evaluating a project that costs $104,299, has a seven-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 4,235 units per year. Price per unit is $50, variable cost per unit is $30, and fixed costs are $81,714 per year. The tax rate is 36 percent, and we require a 9 percent return on this project. Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within +/-10 percent. What is the NPV of the project in worst-case scenario?

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jeff jeffy answered 2 years ago

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