CASE STUDY $-50$ POINTS

THE ULTIMATE RETRO GAMING SYSTEM

Initial Inputs: A technology firm is considering developing "The Ultimate Retro Gaming System" which will include thousands of games, highlighted by many of the classics from the $1970$s$,1980$s$,$ and $1990$s$.$ This project under consideration costs $$500,000,$ has a five$-$year life, and has no salvage value. Depreciation is straight$-$line to zero. The required return is $14\%,$ and the tax rate is $21\%.$ In addition, we have compiled the following information:

$\backslash$table$[[,$Base Case,Lower Bound,Upper Bound$],[$Unit sales,$40,000,35,000,45,000],[$Price per unit,$$100,$$$90,$$$110$