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(a) A project has the following estimated data: Assume the initial investment is depreciated straight line to zero over the life of the project. Ignoring
(a) A project has the following estimated data: Assume the initial investment is depreciated straight line to zero over the life of the project. Ignoring the effect of taxes, calculate: (i) Accounting break-even quantity. (3 marks) (ii) Cash break-even quantity. (2 marks) (iii) Financial break-even quantity. (5 marks) (iv) Degree of operating leverage at financial break-even level of output. (3 marks) (a) A project has the following estimated data: Assume the initial investment is depreciated straight line to zero over the life of the project. Ignoring the effect of taxes, calculate: (i) Accounting break-even quantity. (3 marks) (ii) Cash break-even quantity. (2 marks) (iii) Financial break-even quantity. (5 marks) (iv) Degree of operating leverage at financial break-even level of output
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