Magellen Industries is analyzing a new project. The data they have gathered to date is as follows:

Initial requirement for equipment: $120,000

Depreciation: Straight-line to zero over the four-year life of the project with no salvage value.

Required rate of return: 15%
Marginal tax rate: 35%

a. What is the operating cash flow under the base-case scenario?

b. What is the net income under the worst-case scenario?

c. What is the net present value under the best-case scenario?

d. What is the degree of operating leverage under the worst-case scenario?

e. What is the sensitivity of the net present value to a $1 increase in the fixed cost?

f. What is the sensitivity of the net present value to a $1 decrease in the variable cost per unit?