Question: ( Related to Checkpoint 1 3 . 3 ) ( Scenario analysis ) Family Security is considering introducing tiny GPS trackers that can be inserted
Related to Checkpoint Scenario analysis Family Security is considering introducing tiny GPS trackers that can be inserted in the sole of a child's shoe, which would then allow for the
tracking of that child if he or she was ever lost or abducted. The estimates, that might be off by percent either above or below associated with this new product are shown here: Since
this is a new product line, you are not confident in your estimates and would like to know how well you will fare if your estimates on the items listed above are percent higher or percent lower
than expected. Assume that this new product line will require an initial outlay of $ million, with no working capital investment, and will last for years, being depreciated down to zero
using straightline depreciation. In addition, the firm's required rate of return or cost of capital is percent, and the firm's marginal tax rate is percent. Calculate the project's NPV under
the "bestcase scenario" that is use the high estimatesunit price percent above expected, variable costs percent less than expected, fixed costs percent less than expected, and
expected sales percent more than expected Calculate the project's NPV under the "worstcase scenario."
The NPV for the bestcase scenario will be $Round to the nearest dollar.
The NPV for the worstcase scenario will be $Round to the nearest dollar.
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