Scenario Analysis. Crankshaft Transmissions, Inc.
Scenario Analysis. Crankshaft Transmissions, Inc., has the following estimates for its new gear assembly project: price = $1,320 per unit; variable cost = $270 per unit; fixed cost = $6 million; quantity = $75,000 units. Suppose the company believes all of its estimates are accurate only to within +15 percent. What values should the company use for the four variables given here when it performs its best-case scenario analysis? What about the worst-case scenario?