We are evaluating a project that costs $832,000, has an eleven-year life, and has no salvage...

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We are evaluating a project that costs $832,000, has aneleven-year life, and has no salvage value. Assume thatdepreciation is straight-line to zero over the life of the project.Sales are projected at 84,000 units per year. Price per unit is$39, variable cost per unit is $28, and fixed costs are $848,640per year. The tax rate is 34 percent, and we require a 17 percentreturn on this project. The projections given for price, quantity,variable costs, and fixed costs are all accurate to within +/- 13percent.
Required:
(a) Calculate the best-case NPV.
(b) Calculate the worst-case NPV.

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We are evaluating a project that costs $832,000, has aneleven-year life, and has no salvage value. Assume thatdepreciation is straight-line to zero over the life of the project.Sales are projected at 84,000 units per year. Price per unit is$39, variable cost per unit is $28, and fixed costs are $848,640per year. The tax rate is 34 percent, and we require a 17 percentreturn on this project. The projections given for price, quantity,variable costs, and fixed costs are all accurate to within +/- 13percent.Required:(a) Calculate the best-case NPV.(b) Calculate the worst-case NPV.