Consider the same project as problem 1, but modify it as follows. Suppose that Direct Labor, Materials,
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Consider the same project as problem 1, but modify it as follows. Suppose that Direct Labor, Materials, Selling Expenses, and Other Variable Costs are forecast to be $4.10, $4.20, $1.10, and $2.20, respectively, in year 1 and then grow with inflation. Lease Payment, Property Taxes, Administration, Advertising, and Other cash fixed costs are forecast to be $3,900, $690,
$710, $1,120, and $810, respectively, in year 1 and then grow with inflation.
What are the Total Variable Cost / Unit and the Total Cash Fixed Costs?
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