Quantity of annual sales

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You lead a team evaluating a project with projected sales of 1,800 units a year, a cash flow of $45 a unit and project life of 3 years. The initial cost of the project is $125,000 and the discount rate is 15 percent. She has the option to abandon the project after one year at which time she feels she could sell the project for $75,000. At what quantity of annual sales should she be willing to abandon the project after the first year?

Reference no: EM133056166

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