A machine requires an initial investment of $500,000. The net present value (NPV) of the investment in the machine is $36,500.
Which of the following statements is correct in relation to the sensitivity of the investment?
The initial investment can increase by no more than 7.3% before the project is not viable.
The NPV can decrease by no more than 7.3% before the project is not viable.
The initial investment can increase by no more than 13.7% before the project is not viable.
The NPV can decrease by no more than 13.7% before the project is not viable.
Submit