The machine can produce up to 1 million ice cream bars annually. The marketing director of C&S
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The machine can produce up to 1 million ice cream bars annually. The marketing director of C&S believes that if the company will spend $30,000 on advertising in the first year and another $10,000 in each of the following years, the company will be able to sell 600,000 bars for $1.30 each. The cost of producing each bar is $0.50, and other costs related to the new products are $40,000 annually. C&S’s cost of capital is 14%, and the corporate tax rate is 30%.
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Related Book For
Principles Of Finance With Excel
ISBN: 9780190296384
3rd Edition
Authors: Simon Benninga, Tal Mofkadi
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