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Your firm is evaluating a 5-year project with an initial cost of $450,000, and a...

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Accounting

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Your firm is evaluating a 5-year project with an initial cost of $450,000, and a discount rate of 12 percent. The firm expects to sell 2,000 units a year with $40 cash flow per unit. The firm will have the option to abandon this project after three years at which time it could sell the project for $85,000. At what level of sales should the firm be willing to abandon this project at the end of the third year? 6,657 units 590 units 1,258 units 885 units

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