a1projectfx1b - Autumn 2011 Managerial Finance Prof...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Autumn 2011 Managerial Finance Prof. Francisco Pérez-González Callaway Golf FX-l Case: Part B. Read and prepare the following assignment: Having completed your preliminary analysis of the FX-1 project. A senior VP looks it over and quips, “The problem with NPV is we have no idea if any of the numbers in this analysis are right; indeed, I can guarantee you that almost all of them will turn out to be wrong!” While you agree that there is a fair amount of uncertainty about the projections, you also believe the NPV approach can help quantify the consequences of that uncertainty in a meaningful way. You go back to the feasibility study and find the following best and worst case estimates: Questions: 1. What is the break-even initial sales volume ? (That is, at what level of initial sales will the NPV = 0, if all other assumptions about the project
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Ask a homework question - tutors are online