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What should it use for its worse-case scenarios analysis

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Question - Q1) Sloan Corporation has the following estimates for its new gear assembly product:

Price per unit = $1,220

Variable cost per unit = $380

Fixed costs = $3.75 million

Quantity = 90,000 units

Suppose the company believes all its estimates are accurate only to within +/- 15%.

Required -

A. What values should the company use for the four variables given here when it performs its best-case scenario analysis?

B. What should it use for its worse-case scenarios analysis?

C. Are there any potential concerns with the building of these scenarios?

Q2) In Module 6, you worked on MG Golf's new line of golf clubs. You believe that the values are accurate to within only +/- 10% for unit sales, unit price, and variable costs for the new clubs, for fixed cost, and for sales quantity changes for the existing high-priced and cheap clubs. What are the best-case and worst-case net present values (NPVs)?

Reference no: EM133189044

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