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Modern Artifacts can produce keepsakes that will be sold for $100 each. Nondepreciation fixed costs are $1,800 per year and variable costs are $45 per
Modern Artifacts can produce keepsakes that will be sold for $100 each. Nondepreciation fixed costs are $1,800 per year and variable costs are $45 per unit. a. If the project requires an initial investment of $2,000 and is expected to last for 5 years and the firm pays no taxes. The initial investment will be depreciated straight-line over 5 years to a final value of zero, and the discount rate is 12%. What are the accounting and NPV break-even levels of sales? a-1. Accounting break-even levels of sales _____units a-2. NPV break-even levels of sales _____units b. What will be the accounting and NPV break-even levels of sales, if the firm's tax rate is 35%? b-1. Accounting break-even levels of sales _____units b-2. NPV break-even levels of sales _____units
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