Hi Hi, Why are we referring to “contribution” in sales volume and not change in units. As for Units, it should 12.9% change. because 2.21 % of 15000 is 331.5 units and 331.5 * 2.75 (contribution) 911.6 in contribution, not the figure we require for NPV to fall to 0.
But what are we uncertain about is volume, so what cash flows are affected by volume – that is revenue and variable costs So we need PV of contribution