A B D E F G 17 EXHIBIT: SIMPLEST COMPANY MODEL 18 2019 2020 2021E 19 20 Revenues 100 110 121 21 Growth 10% 10% 22 Cost of Revenues 60 64 70 23 Gross Profits 40 46 51 24 Gross Margin 40% 42% 42% 25 Operating Expenses (OpEx) 15 17 19 26 OpEx Percent of Revenues 15% 15% 15% 27 EBIT 25 29 32 28 29 30 If the financial analyst were to create a nave forecast of revenues for 2021E, what growth rate would you use? 31 32