- Words: 2188
- Length: 7 Pages
- Topic: Business
- Paper #: 50044804
But even with no cost savings whatsoever, this project has a positive NPV.
We can see, therefore, that the greatest area of sensitivity is with the terminal value. The terminal value at present is worth $143 million of the NPV. If we break down the variables that go into the terminal value, however, we notice that the cost savings are critical. If SGA expense is not reduced, then the terminal