Question: Consider a three-year project with the following information: Initial fixed asset investment =$710,000; straight-line depreciation to zero over the 5-year life; zero salvage value; price

Consider a three-year project with the following information: Initial fixed asset investment =$710,000; straight-line depreciation to zero over the 5-year life; zero salvage value; price =$39.39; variable costs =$28.31; fixed costs =$332,000; quantity sold = 87,000 units; tax rate =24 percent. How sensitive is OCF to changes in quantity sold? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
