1. You are given the following forecasted data about a project:

• Project life = 3 years
• Required investment = $1,200,000
• Salvage value = $200,000
• Depreciation method = straight-line depreciation
• Unit price = $140
• First year's demand = 100,000 units
• Annual demand growth rate = 5%
• Unit variable cost = $80
• Annual fixed cost = $10,000
• Income tax rate = 40%
• MARR = 10%

1. Suppose the key variable is identified here to be the first year's demand. This variable's most likely value is 100,000 units (as indicated above), but what would happen to the NPW if it were 120,000 units instead? The change in the NPW values (new NPW - original NPW) is closest to:
2. -$1,875,732.53
4. $1,875,732.53
6. $1,563,110.44
8. -$1,563,110.44