We are evaluating a project that costs $822,600, has a nine-year life, and has no salvage value. Assume that depreciatio

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answerhappygod
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We are evaluating a project that costs $822,600, has a nine-year life, and has no salvage value. Assume that depreciatio

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We are evaluating a project that costs $822,600, has a nine-yearlife, and has no salvage value. Assume that depreciation isstraight-line to zero over the life of the project. Sales areprojected at 75,000 units per year. Price per unit is $53, variablecost per unit is $37, and fixed costs are $755,000 per year. Thetax rate is 22 percent, and we require a return of 9 percent onthis project. Suppose the projections given for price, quantity,variable costs, and fixed costs are all accurate to within ±10percent. Calculate the best-case and worst-case NPV figures. (Anegative answer should be indicated by a minus sign. Do not roundintermediate calculations and round your answers to 2 decimalplaces, e.g., 32.16.)
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