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We are evaluating a project that costs $813,000, has a life of ten years, and...

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Finance

We are evaluating a project that costs $813,000, has a life of ten years, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 97,000 units per year. Price per unit is $38, variable cost per unit is $26, and fixed costs are $822,756 per year. The tax rate is 24 percent, and we require a return of 21 percent on this project. The projections given for price, quantity, variable costs, and fixed costs are all accurate to within +/- 15 percent. a. Calculate the best-case NPV. Best case b. Calculate the worst-case NPV. Worst case
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We are evaluating a project that costs \\( \\$ 813,000 \\), has a life of ten years, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 97,000 units per year. Price per unit is \\( \\$ 38 \\), variable cost per unit is \\( \\$ 26 \\), and fixed costs are \\( \\$ 822,756 \\) per year. The tax rate is 24 percent, and we require a return of 21 percent on this project. The projections given for price, quantity, variable costs, and fixed costs are all accurate to within \\( +1-15 \\) percent. a. Calculate the best-case NPV. Best case b. Calculate the worst-case NPV

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