Mabel is reviewing a project with projected sales of 1,500 units a year, a cash flow of $30 a unit and a four-year project life. The initial cost of the project is $95,000. The relevant discount rate is 15%. Mabel has the option to abandon the project after one year at which time she feels she could sell the project for $65,000. At what level of sales should she be willing to abandon the project?

	a.	899 units
	b.	1,077 units
	c.	1,206 units
	d.	949 units

A company is investing $259,000 in a new project. The firm expects the project will produce cash flow $80,000 a year for the first two years, and $50,000 a year for the following three years. How long will it take the company to recover its initial investment in this project?

	a.	5.14 years
	b.	3.99 years
	c.	2.74 years
	d.	4.58 years

Answer rating: 100% (QA)

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