Question
Circle City Kombucha is considering the introduction of a new blueberry kombucha. The initial investment required is $55,000, and annual maintenance costs of the equipment
Circle City Kombucha is considering the introduction of a new blueberry kombucha. The initial investment required is $55,000, and annual maintenance costs of the equipment needed are anticipated to be $6,000. Annual operating costs are variable and will be directly proportional to the level of production, at $3.30 per bottle. Each bottle can be sold for a price of $7.40. If your company's MARR is 12% and they plan to make this drink for 11 years, what is the minimum annual production level for which the project would be economically viable? If you calculate a fractional number of bottles, round up to the nearest whole number of units greater than the fractional amount.
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