Locust Software has been in existence for two years; it is one of several successful firms that develop computer programs. Current sells for cash only. Locust is evaluating a request from some major customers to change its current policy to net 30 days. To an proposal, we define the following: P = Price per unit = $49 v=Variable cost per unit = $20 Q = Current quantity sold per month = 100 Q' = Quantity sold under new policy = 110 R = Monthly required return = 2%/month For now, we ignore discounts and the possibility of default. Also, we ignore taxes because they don't affect our conclusions. Calculating the NPV of switching policy What is the break-even point of the new policy? 1. 2