How sensitive is OCF to changes in quantity sold

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Reference no: EM131130973

Consider a three-year project with the following information: initial fixed asset investment = $710,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $34.75; variable costs = $22.90; fixed costs = $213,500; quantity sold = 99,500 units; tax rate = 40 percent.

Required: How sensitive is OCF to changes in quantity sold? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Reference no: EM131130973

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