1. Nike is planning to expand its manufacturing operations to a new country. The expansion project includes fixed setup costs of $50 million and variable production costs of $10 per unit. Nike expects to produce 1 million units annually, generating $100 million in additional revenue.

Requirements:

• Create a table summarizing the setup costs, variable costs per unit, and revenue projections.
• Calculate the total investment required for the expansion project.
• Determine the breakeven point in units and revenue for the new manufacturing facility.
• Discuss the strategic rationale for expanding Nike's manufacturing footprint.
• Evaluate the financial impact of the expansion on Nike's income statement.
• Recommend operational efficiencies to optimize production and profitability.