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11. Case Study A manufacturing project would have a life of 15 years and it will lead to import substitution. Using the social conversion factors, calculate the economic rate of return for the project. After 15 years only working capital will be recovered. The capital outlay on the project is expected to be as follows: Tk. in million Building 11.00 Land 2.00 Imported equipment (CIF value: Tk. 9 million) 15.00 Indigenous equipment 80.00 (CIF value of similar equipment: Tk. 60 million) Transport 2.00 Engineering and know-how fees 6.00 Pre-operative expenses 6.00 Bank Charges 3.70 The Working Capital requirement of the project consisting only of domestic raw materials, will be Tk. 30 million. The essential annual profitability of the project is as follows: Revenue (Tk. In million) Sales Revenue (CIF value of the output is TK. 110 million) 150 Expenses Raw materials and stores (indigenous) 85 Labor 7 Salaries 5 Repairs and maintenance 1.2 Water, fuel, etc. 6 Duty on Electricity 6 Depreciation 4.8 Other overheads 10