Question: Please answer both the question and try to give typed answer, and try to ans in a good language i will appreciate it 2) A)

Please answer both the question and try to give typed answer, andPlease answer both the question and try to give typed answer, and try to ans in a good language i will appreciate it

2) A) A manufacturing firm is considering a four-year project with initial outlay of 8,00,000. The scrap value of the asset so created is nil. The firm is expected to sell 2000 units of the output at 1200 per unit. The incremental cost of manufacturing these units is 800 per unit. The firm is enjoying tax exemption during the project life and has 15 percent cost of capital. Using sensitivity analysis, explain whether the project is more sensitive to selling price, sales volume or manufacturing cost? B) How will you choose between two mutually exclusive projects which do differs in terms of their useful life of operation

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