Question: We are evaluating a project that costs $618,100, has a seven-year life, and has no salvage value. Assume that depreciation is straight-line to zero over
| We are evaluating a project that costs $618,100, has a seven-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 90,000 units per year. Price per unit is $45, variable cost per unit is $32, and fixed costs are $715,000 per year. The tax rate is 24 percent, and we require a return of 9 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. (A negative answer should be indicated by a minus sign. Do not round |
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