Question: While evaluating a project that costs $2.58 million having 6 years life has no salvage value. Estimated sales at $3150000 per year, price per unit

While evaluating a project that costs $2.58 million having 6 years life has no salvage value. Estimated sales at $3150000 per year, price per unit is 45$, variable cost per unit is 12.5$ and fixed cost $37500 per year. The tax rate and the required rate of return is 18% and 11% respectively.

1. Find the base cash flow

2. Find the base NPV

3. Find the NPV change for a 400 unit decrease of projected sales

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