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Given the forecasted data, determine the number of planes that the company must produce in order to break even, on both accounting basis and NPV
Given the forecasted data, determine the number of planes that the company must produce in order to break even, on both accounting basis and NPV basis. The project initial investment is $1,000 million, each plane sold for $20 million, the variable cost is $12 million each plane, the fixed cost is $200 million, the depreciation uses straight-line method, tax rate is 30% and the companys cost of capital is 11%. The project runs for 12 years.
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