Interest and MARR = 10% per year unless stated otherwise

Taxation Effective tax rate is 30%

1. If Spotify grows at only 4% per year after 2021 and you estimate that right now (year 0) they have an average charge of $10 per subscriber so they have $1650M in sales, twenty years from now, who has more revenue Spotify or The Scale? ______________

2. If Spotifys profit margin is 22% (so their profit is 22% of their revenue) then who has more profit 20 years from now? Spotify or The Scale? _______________

3. What is the difference in profit between Spotify and The Scale [units in $M]? __________

4. What is the total cost for The Scale in PW based off Figure 2 [units in $M]? ______________

5. What is the total sales for The Scale in PW based off Figure 3 [units in $M]?

Figure 3: Sales projected for The Scale (year O is 2021) Sales [in $M] 1800 1,627.41 1600 1,415.14 1400 1,230.56 1200 Plot Area 1,070.05 1000 930.48 809.11 800 703.58 611.80 600 532.00 g=15% 462.61 402.27 400 349.80 304.18 264.50 230.00 180.00 200.00 200 160.00 140.00 100.00 120.00 11 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Figure 2: Costs of The Scale Costs [in $M] 140.00 125.32 120.00 113.92 103.57 100.00 94.15 85.59 77.81 80.00 70.74 64.31 58.46 60.00 53.15 g=10% 48.32 43.92 39.93 40.00 36.30 33.00 30.00 25.00 20.00 20.00 15.00 10.00 5.00 0.00 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20