18. From the following project details calculate the sensitivity of the (a) Project cost, (b) Annual Cash Flow and (c) Cost of Capital. Which variable is the most sensitive?
Project cost Rs. 12,000 Annual Cash Flow Rs. 4,500
Life of the project 4 years Cost of capital 14%
The annuity factor at 14% for 4 years is 2.9137 and at 18% for 4 years is 2.667.
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