You are considering a new product launch. The project will cost $1,450,000, have a four-year life,...
You are considering a new product launch. The project will cost $1,400,000, have a four-year life, and have no salvage value; depreciation 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 fixed costs will be $430,000 per year. The required return on the project is 12 percent, and the relevant tax rate is 35 percent. Evaluate the sensitivity of your base-case NPV to...
You are considering a new product launch. The project will cost $1,950,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 180 units per year; price per unit will be $24,000, variable cost per unit will be $15,000, and fixed costs will be $540,000 per year. The required return on the project is 10 percent, and the relevant tax rate is 34 percent.
You are considering a new product launch. The project will cost $1,600,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 160 units per year; price per unit will be $20,000, variable cost per unit will be $11,500, and fixed costs will be $470,000 per year. The required return on the project is 15 percent, and the relevant tax rate is 35 percent. a. The unit sales, variable cost, and...
You are considering a new product launch. The project will cost $2,125,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 240 units per year; price per unit will be $18,900, variable cost per unit will be $12,650, and fixed costs will be $630,000 per year. The required return on the project is 9 percent, and the relevant tax rate is 22 percent. a. Based on your experience, you think the...
You are considering a new product launch. The project will cost $857,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 180 units per year; price per unit will be $19,200, variable cost per unit will be $15,100, and fixed costs will be $345,000 per year. The required return on the project is 11 percent, and the relevant tax rate is 34 percent. Requirement 1: Based on your experience, you think...
You are considering a new product launch. The project will cost $2,150,000, have a four year life, and have no salvage value, depreciation is straight-line to zero. Sales are projected at 150 units per year, price per unit will be $28,000, variable cost per unit will be $17,000, and fixed costs will be $580,000 per year. The required retum on the project is 12 percent, and the relevant tax rate is 34 percent a. The unit sales, variable cost, and...
You are considering a new product launch. The project will cost $1,750,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 220 units per year; price per unit will be $20,000, variable cost per unit will be $13,000, and fixed costs will be $500,000 per year. The required return on the project is 15 percent, and the relevant tax rate is 34 percent. a. The unit sales, variable cost, and fixed...
You are considering a new product launch. The project will cost $750,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 180 units per year; price per unit will be $18,500, variable cost per unit will be $11,400, and fixed costs will be $522,000 per year. The required return on the project is 12 percent, and the relevant tax rate is 28 percent. a) Based on your experience, you think the...
You are considering a new product launch. The project will cost $2,050,000, have a four-year life, and have no salvage value: depreciation is straight-line to zero. Sales are projected at 170 units per year; price per unit will be $26,000, variable cost per unit will be $16,000, and fixed costs will be $560,000 per year.
You are considering a new product launch. The project will cost $750,000, have a four-year life, and have no salvage value; depreciation is straight-line to zero. Sales are projected at 210 units per year; price per unit will be $17,750, variable cost per unit will be $13,400, and fixed costs will be $375,000 per year. The required return on the project is 10 percent, and the relevant tax rate is 35 percent. Requirement 1: Based on your experience, you think...