Changes in the variable cost per unit projection

Assignment Help Financial Management

Reference no: EM131873429

We are evaluating a project that costs $835734, has an eight-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 55437 units per year. Price per unit is $44, variable cost per unit is $22, and fixed costs are $424193 per year. The tax rate is 35%, and we require a return of 20% on this project.

In percentage terms, what is the sensitivity of OCF to changes in the variable cost per unit projection? (Round answer to 2 decimal places. Do not round intermediate calculations)

Reference no: EM131873429

Questions Cloud

Company decides to wait two years to purchases the machine : Your company is deciding whether to invest in a new machine. What is the NPV if the company decides to wait 2 years to purchases the machine?

What are some project pitfalls you will want to watch out : How will project communications and interactions work between the project manager, the stakeholders and the project team?

What type of information is included on a credit report : What is a credit score? When and why is a credit score important? What type of information is included on a credit report?

Describe the government relations tactics : Describe the government relations tactics you would use as part of your public relations campaign, and explain in detail how these tactics will help.

Changes in the variable cost per unit projection : In percentage terms, what is the sensitivity of OCF to changes in the variable cost per unit projection?

Calculate change in gdp : A person marries their butler, whom they formerly paid $75,0001 a year. After they are married, her husband continues to wait on her as before

National average reported by the cpi : How might it be possible for some consumers to experience more inflation than the national average reported by the CPI?

Discuss the major arguments made by your authors : Discuss the major arguments made by your authors regarding globalization. As a global manager are you for -OR- against globalization? Why?

Example of a popular perceptions vs reality : Example of a popular perceptions vs. reality when it comes to issues of safety and well-being of children in the US.

User Account

All Pages