Mike has set up a new company and estimates that the cost of capital is 10%. His first project involves investing in $100,000 of equipment with a life of 10 years and a final scrap value of $10,000.
The equipment will produce 10,000 units p.a. generating a contribution of $2 each. He estimates that additional fixed costs will be $10,000 p.a.
Determine, on the basis of the above figures, whether the project is worthwhile
Calculate the sensitivity to change of:
The initial investment
The sales volume p.a.
The contribution p.a.
The fixed costs p.a.
The scrap value
The cost of capital
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.Read more
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.Read more
Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.Read more
By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.Read more