Conduct sensitivity analysis by determining the effect on


Questions

1. Evaluate financial feasibility of the project using

a. Net Present Valueb. IRRc. Modified IRR assuming reinvestment rate of 14%.

2. What is the break-even number of units in terms of the project achieving a zeroNPV?

3. Conduct sensitivity analysis by determining the effect on NPV of the followingchanges:

a. Demand for the new line of components falls by 5%.

b. Selling price per unit of the new line of components falls by 6%.

c. Variable cost per unit of the new line of components increases by 5%.

d. Cost of capital increases to 14%.

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Financial Management: Conduct sensitivity analysis by determining the effect on
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