What is the sensitivity of ocf to changes in the variable


We are evaluating a project that costs $836559, has an eight-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 62175 units per year. Price per unit is $35, variable cost per unit is $19, and fixed costs are $418916 per year. The tax rate is 35%, and we require a return of 22% on this project.

In percentage terms, what is the sensitivity of OCF to changes in the variable cost per unit projection? (Round answer to 2 decimal places. Do not round intermediate calculations)

Request for Solution File

Ask an Expert for Answer!!
Financial Management: What is the sensitivity of ocf to changes in the variable
Reference No:- TGS02668725

Expected delivery within 24 Hours