Create an Account

Already have account?

Forgot Your Password ?

Home / Questions / We are evaluating a project that costs $1120000 has a ten year life and has no salvage val...

We are evaluating a project that costs $1120000 has a ten 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

We are evaluating a project that costs $1,120,000, has a ten-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 64,000 units per year. Price per unit is $50, variable cost per unit is $25, and fixed costs are $620,000 per year. The tax rate is 35 percent, and we require a return of 12 percent on this project. Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within ±10 percent.

Calculate the best-case and worst-case NPV figures.

Apr 08 2020 View more View Less

Answer (UnSolved)

question Get Solution

Related Questions