Question: You are considering a new product launch. The project will cost $1,400,000, have a four-year life, and have a salvage value of zero. The product

You are considering a new product launch. The project will cost $1,400,000, have a four-year life, and have a salvage value of zero. The product falls into the three-year MACRS class. Sales are projected at 190 units per year; price per unit will be $21,000, variable costs per unit will be $15,000, and fixed costs will be $225,000 per year. The required return of the project is 15 percent, and the relevant marginal tax rate is 35 percent.

  1. Based on your experience you think that unit sales, variable cost, and fixed cost projections given here are probably accurate to within

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