Answer:
Best-case profit: $2,500,000
Worst-case profit: -$300,000
Base case profit: $100,000
Explanation:
initial cost $300,000
variable cost between $160 - $240
most likely variable cost $200
sales price per unit $300
expected demand 0 - 20,000 units
most likely expected demand 4,000 units
best case scenario:
20,000 units x $300 = $6,000,000
- variable costs 20,000 x $160 = -$3,200,000
- fixed cost = -$300,000
profit = $2,500,000
base case scenario:
4,000 units x $300 = $1,200,000
- variable costs 4,000 x $200 = -$800,000
- fixed cost = -$300,000
profit = $100,000
worst case scenario:
0 units x $300 = $0
- fixed cost = -$300,000
profit = -$300,000
