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We are evaluating a project that costs $901,000, has an 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 101,000 units per year. Price per unit is $43, variable cost per unit is $22, and fixed costs are $909,109 per year. The tax rate is 34 percent, and we require a 18 percent return on this project. The projections given for price, quantity, variable costs, and fixed costs are all accurate to within +/- 15 percent. Calculate the best-case NPV. Calculate the worst-case NPV.

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  • Category:- Financial Management
  • Reference No.:- M92097123

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