You are considering a new product launch. The project will cost $$1\mathrm{.}675$ million, have a

four$-$year life, and have no salvage value; depreciation is straight$-$line to zero. Sales are

projected at $195$ units per year; price per unit will be $$16,300$; variable cost per unit will

be $$9,400$; and fixed costs will be $$550,000$ per year. The required return on the project

is $12$ percent and the relevant tax rate is $21$ percent.

a$.$ Based on your experience, you think the unit sales, variable cost, and fixed cost

projections given above are probably accurate to within $+-10$ percent. What are the

upper and lower bounds for these projections? What is the base$-$case NPV$?$ What are

the best$-$case and worst$-$case scenarios? $($A negotlve answer should be Indlceted by

a minus slgn$.$ Do not round Intermedlete calculations and round your NPV

answers to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

b$.$ Calculate the sensitivity of your base$-$case NPV to changes in fixed costs. $($A

negatlve answer should be Indlcated by a minus slgn$.$ Do not round Intermedlate

calculations and round your answer to $2$ declmal places, e$.$g$.,32\mathrm{.}16.)$

c$.$ What is the accounting break$-$even level of output for this project? $($Do not round

Intermedlete calculations and round your answers to $2$ declmal places, e$.$g$.,32\mathrm{.}16.)$