A carmaker company is thinking about introducing a new sport car.

The firm already produces different types of cars including luxury cars.

It is a 10-year project.

It would require a $200 million investment.

1. The firm estimates that they will be able to sell each year 20,000 cars at $40,000 each.

However, 25% of the customers will come from existing customers of the firm and who buy luxury cars.

We assume that the price of the luxury car is $35,000.

What will be the incremental revenues of the project?