Question: We are evaluating a project that costs $874,800, has a nine-year lfe, and has no salvage value. Assume that depreciation is stralght-ine to zero over
We are evaluating a project that costs $874,800, has a nine-year lfe, and has no salvage value. Assume that depreciation is stralght-ine to zero over the life of the project. Sales are projected at 85,000 units per year. Price per unit Is $55, varlable cost per unlt Is $39, and fixed costs are $765,000 per year The tax rate is 24 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. (A negative answer should be Indicated by a mlnus sign. Do not round Intermediate caiculatlons and round your answers to 2 declmel places, e.g., 32.16.) NPV Best-case Worst-case
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