A company is considering an investment in a new product with a $10-$year horizon $($product will be sold for $10$ years$).$ The upfront investment is $$5$ million and it is assumed to depreciate on a straight$-$line basis for $10$ years, with no residual value. Fixed costs are assumed to be $$550,000$ per year. The company estimates variable cost per unit $($v$)$ to be $$120$ and expects to sell each unit for $$425.$ There are no taxes and the required rate of return is $17\%$ per year. Assume that the investment would occur today, and all future cash$-$flows will occur at the end of each year beginning in one year.

what is the annual financial breakeven quantity? Consider the previous question with the following new information: Fixed costs are assumed to be $$550,000$ per year. The company estimates the variable cost per unit $($v$)$ to be $$120$ and expects to sell each unit for $$425.$ There are no taxes and the required rate of return is $17\%$ per year. Suppose that sales are currently estimated to be $5400$ units per year.

What is the degree of operating leverage?

$($Round to the CLOSEST $1$ decimal place, ie $2\mathrm{.}3)$

Using your answer from above, ESTIMATE what the new annual operating cash flow $($OCF$)$ will be if sales increase by $150$ units: $