You are considering a new product launch. The project will cost $1,400,000, have a four-year life, and have no salvage value; de- preciation is straight-line to zero. Sales are projected at 180 units per year; price per unit will be $16,000, variable cost per unit will be $9,800, and f xed costs will be $430,000 per year. The required return on the project is 12 percent, and the relevant tax rate is 35 percent. Based on your experience, you think the unit sales, variable cost, and f xed cost projections given here are probably accurate to within
You are considering a new product launch. The project will cost $1,400,000, have a four-year life, and have no salvage value; de- preciation is straight-line to zero. Sales are projected at 180 units per year; price per unit will be $16,000, variable cost per unit will be $9,800, and f xed costs will be $430,000 per year. The required return on the project is 12 percent, and the relevant tax rate is 35 percent. Based on your experience, you think the unit sales, variable cost, and f xed cost projections given here are probably accurate to within
Related questions
| You are considering a new product launch. The project will cost $1,232,500, have a five-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 310 units per year; price per unit will be $19,300, variable cost per unit will be $15,800, and fixed costs will be $329,000 per year. The required return on the project is 13 percent, and the relevant tax rate is 35 percent. |
| Requirement 1: |
| Based on your experience, you think the unit sales, variable cost, and fixed cost projections given here are probably accurate to within |
