Topic > General Food Case Study - 704
An amount of $294,760 has been calculated, which indicates that the project should be accepted. A sensitivity analysis was then performed that examined the effect of the discount rate, tax rate, revenue growth or decline, and erosion cost fluctuation on the NPV. Revenue has been found to have a significant effect on overall NPV. A drop in expected revenue for Super of approximately 3.55% brought the project's NPV to zero. This equates to sales of approximately $79,200 for the first year and a continued decline in sales for the remaining 10 years of the same amount.
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