You are considering a new product launch in UK$.$ The project will cost $200,000$$$,$ have a four year life, and have no salvage value; depreciation is straight line to zero. Sales are projected at $120$ units per year; price per year will be $6,000$$$,$ variable cost per unit will be $4,500$$$,$ and fixed costs will be $50,000$$ per year. The required return on the project is $20\%,$ and the relevant tax rate is $25\%.$

a$)$ What is the cash break$-$even, accounting break$-$even and financial break$-$even level of output for base year? How do you interpret your results for case?

How do you explain the difference between senario and sensitivity analyses? Why do you think it is important to calculate best and worst case senarios$?$