Question: Problem 9 - 2 1 Scenario Analysis [ lll 3 ] We are evaluating a project that costs $ 2 , 1 9 0 ,

Problem 9-21 Scenario Analysis [lll 3]
We are evaluating a project that costs $2,190,000, has a 8-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 91,200 units per year. Price per unit is $38.97, variable cost per unit is $24.05 and fixed costs are $866,000 per year. The tax rate is 22 percent and we require a return of 11 percent on this project. Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within -10 percent. Calculate the best-case and worst-case NPV figures.
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g.,32.16.
Best-case NPV
Problem 9 - 2 1 Scenario Analysis [ lll 3 ] We

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