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A project currently generates sales of $10.5 million_Answer

A project currently generates sales of $10.5 million_Answer

A project currently generates sales of $10.5 million_Answer

A project currently generates sales of $10.5 million_Answer

A project currently generates sales of $10.5 million_Answer

A project currently generates sales of $10.5 million_Answer

A project currently generates sales of $10.5 million, variable costs equal to 50% of sales, and fixed costs of $2.7 million. The firm’s tax rate is 40%. The project will last for 10 years. The discount rate is 10%.
A) What is the effect on project NPV, if sales increase from $10.5 million to $11.9 million – do not round intermediate calculations, answer in million rounded to 3 decimal places: change in cash flow =
B) What is the effect on project NPV, if variable costs increase to 60% of sales: change in cash flow =
C) If project NPV under the base-case scenario is $2.7 miilion, how much can fixed costs increase before NPV turns negative – answer in dollars, not million, round to nearest dollar: increase in fixed cost =
D) How much can fixed costs increase before accounting profits turn negative – do not round intermediate calculation, answer in million to rounded 2 decimals: increased in fixed cost =

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