QUESTION $8$

Consider a five$-$year project with the following information: initial fixed asset investment $=$$$520,000$; straight$-$line depreciation to zero over the five$-$year life; zero salvage value; price $=$$$\frac{49\mathrm{.}50}{?}$ unit; variable costs $=$$$\frac{16\mathrm{.}80}{?}$ unit; fixed costs $=$$$250,000$ per year; quantity sold $=100,000$ units per year; tax rate $=25\%.$ How sensitive is OCF to changes in quantity sold $($i$.$e$.,$ how much does OCF change given an increase of one unit sold in a year$)?$

$$24\mathrm{.}53$

$$31\mathrm{.}12$

$$30\mathrm{.}61$

$$32\mathrm{.}38$

$$30\mathrm{.}25$