Answered step by step
Verified Expert Solution
Question
1 Approved Answer
see attached - only question 12 You are still working on the break-even for the project from the previous question. The possible values for Market
see attached - only question 12
You are still working on the break-even for the project from the previous question. The possible values for Market Share, Price/Unit, VC/Unit, and Fixed Costs are below. Any information that you need that is not included in this question, you can use from the previous question. But now assume that you found the break even cash flow to be $37.47 million. The tax rate is 22.8\%. Determine the financial break-even EBIT. Input your answer in dollars, rounded to the nearest dollar (so if your answer is $5.511 million, input 5.511,000 ). (Do not input the assumed break-even EBIT from the next question; it will not get you credit here). You are trying to determine the financial break-even (as we defined in class) market size for the following project. Your project requires the use of a building with a current market value of $176 million, but you already own the building and it is fully depreciated (you will have not new depreciation expenses). There are no other initial investment costs and no annual capital expenditures. The discount rate for the project is 21.99%. The risk-free rate is 2.51%, and the market risk premium is 6.2%. The project is expected to generate constant annual cash inflows starting in one year and continuing forever. There will be no new NWC requirements. The possible values for Market Share, Price/Unit, VC/Unit, and Fixed Costs are below. Using this information, calculate the financial break-even cash flow. Input your answer in dollars, rounded to the nearest dollar (so if your answer is $5.511 million, input 5,511,000). (Do not plug in the assumed break-even CF value from the next question; it will not get you credit here) Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started