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1.What is the break-even (NPV=0) annual incremental sales for the following investment? Initial investment at time t=0 is $2,400,000 Life of project is 12 years
1.What is the break-even (NPV=0) annual incremental sales for the following investment?
- Initial investment at time t=0 is $2,400,000
- Life of project is 12 years
- Initial investment depreciated to $0 via straight-line over entire life
- NWC investment required = $0.00
- Expected market salvage value of investment assets = $0.00
- Starting 1-year from today, and remaining constant over project life:
- Incremental expenses as a result of investment = $1,000,000 / year
- firm' tax rate = 34%
- required return on investment = 16%
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Linear Algebra And Its Applications
Authors: David Lay, Steven Lay, Judi McDonald
6th Global Edition
978-1292351216, 1292351217
