Reference no: EM131304515
McGilla Golf has decided to sell a new line of golf clubs. The company would like to know the sensitivity of NPV to changes in the price of the new clubs and the quantity of new clubs sold. The clubs will sell for $780 per set and have a variable cost of $380 per set. The company has spent $148,000 for a marketing study that determined the company will sell 52,000 sets per year for seven years.
The marketing study also determined that the company will lose sales of 9,300 sets of its high-priced clubs. The high-priced clubs sell at $1,080 and have variable costs of $680. The company will also increase sales of its cheap clubs by 10,800 sets. The cheap clubs sell for $420 and have variable costs of $220 per set. The fixed costs each year will be $9,080,000. The company has also spent $1,090,000 on research and development for the new clubs.
The plant and equipment required will cost $28,560,000 and will be depreciated on a straight-line basis. The new clubs will also require an increase in net working capital of $1,280,000 that will be returned at the end of the project. The tax rate is 36 percent, and the cost of capital is 10 percent. What is the sensitivity of the NPV to each of these variables?
(Do not round intermediate calculations and round your final answers to 2 decimal places, e.g., 32.16.) NPV ?NPV/?P $ ?NPV/?Q $
What causes urinary tract infection in pregnancy
: What causes Urinary Tract infection in pregnancy?Body-a critical comparison of research articles is performed,Significant similarities and difference are identified.
|
Design and build a counter that can display the sequence
: Design and build a counter that can display the sequence assigned to you by the instructor (see table below). Use two J-K flip-flops for the two most significant bits and two D flip-flops for the two least significant bits. Use Multisim to implement ..
|
What was your rate of return from investing in the stock
: Suppose that at the beginning of the year, you buy a share of IBM stock for $120. If during the year you receive a dividend of $2.50 and IBM stock is selling for $130 at the end of year, what was your rate of return from investing in the stock?
|
Speculate on the web analytic tool that commonly used
: Social media websites, such as Facebook, Twitter, and e-Commerce giant Amazon, use some form of Web analytics. Speculate on the Web analytic tool that you believe is most commonly used. Justify your response.
|
What is the sensitivity of the npv to each of the variables
: The tax rate is 36 percent, and the cost of capital is 10 percent. What is the sensitivity of the NPV to each of these variables?
|
State and explain your decision in a one-page summary
: Please state and explain your decision in a one-page summary. Make sure to include a title page. In your summary, be sure to reference course material (readings, lectures, or concepts from the flash cards).
|
Prepare a curriculum development committee
: Prepare a curriculum development committee.In this essay, you, as the student representative for the curriculum development committee at OSU, must answer the question: which work of literature should be required reading for every freshman at OSU, t..
|
Evaluate two proposed alternatives regarding insulin pump
: Evaluate the two proposed alternatives regarding the insulin pump.- Based upon your evaluation identify which alternative should be selected and support your decision.
|
Why nurse has to withhold the transfusion
: In this case study that Mark is refusing to get blood because of his religious beliefs. That's why nurse has to withhold the transfusion by following standard care of nursing practice. So by giving respect to Mark's decisions nurse is doing his/her..
|