Question: Consider a three-year project with the following information: Initial fixed asset investment = $675,000; straight-line depreciation to zero over the 4-year life; zero salvage value;
Consider a three-year project with the following information: Initial fixed asset investment = $675,000; straight-line depreciation to zero over the 4-year life; zero salvage value; price = $38.83; variable costs = $27.89; fixed costs = $311,000; quantity sold = 80,000 units; tax rate = 22 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.
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