For a new product, sales volume in the first year is estimatedto be 50,000 units and is projected to grow at a rate of 7% peryear. The selling price is $100 and will increase by $10 each year.Per-unit variable costs are $22 and annual fixed costs are$1,000,000. Per-unit costs are expected to increase 4% per year.Fixed costs are expected to increase 10% per year.
Develop a spreadsheet model to predict the net present value ofprofit over a three-year period, assuming a 4% discount rate.
Please include Excel worksheet with all the details.
