also need:

NPV?

Sensitivity of NPV to changes in quantity sold?

What your answer tells you avout a 500-unit decrease in quantity sold?

Sensitivity of OCF to changes in variable cost figure?

How much will OCF change if variable costs decrease by $1?

We are evaluating a project that costs $709,000, has a life of 8 years, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 91,000 units per year. Price per unit is $42, variable cost per unit is $27, and fixed costs are $714,672 per year. The tax rate is 22 percent, and we require a return of 15 percent on this project. 1a. Calculate the accounting break-even point. 1b. What is the degree of operating leverage at the accounting break-even point? 2a. Calculate the base-case cash flow