18.6)

answer all questions

Operating exposure. Copy-Cat, Inc, has signed a deal to make vintage Nissan 240 -Z sports cars for the next three years. The company will buld the cars in Japan and ship them to the United Statin for saith. The current indirest rase is V111.54 19 pert dolar. The antiolpaled infotion rate for parts and labor in Japan is 2.4% over the next three years, and the anticipated overat inflaton rate to sell 600 cars a year at en initial price of $40,000 and the cost of production is $4,036,500, what is the annual proft in doltars for Copy-Car? Assume it tates one year for production and all sales revenues and production costs occur at the end of the year. It this proft rising or faling esch year? Why? What is the expected sales reveocue per car in dollan for Copy. Cat in year 1 ? 5 (Round to the nearest cent.)