Western industrial products is considering a project with a


Western Industrial Products is considering a project with a five-year life and an initial cost of $110,000. The discount rate for the project is 13 percent. The firm expects to sell 2,400 units a year. The cash flow per unit is $25. The firm will have the option to abandon this project at the end of year three (after year three's sales) at which time the project's assets could be sold for an estimated $55,000. The firm should abandon the project at the end of year three if the expected level of annual sales, starting with year 4, falls to _____ units or less. Ignore taxes.

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Western industrial products is considering a project with a
Reference No:- TGS02852797

Expected delivery within 24 Hours