• Tesla is considering launching a new energy storage system with the following financial details:
  • Development Costs: $1 billion
  • Production Costs per Unit: $15,000
  • Selling Price per Unit: $25,000
  • Estimated Annual Sales: 50,000 units
  • Fixed Costs: $300 million annually

• Requirements:
  1. Calculate the total annual revenue and production cost for the energy storage system.
  2. Prepare a break-even analysis.
  3. Analyze the profit margin per unit and overall.
  4. Discuss the strategic importance of the energy storage system for Tesla’s energy division.
  5. Evaluate the potential market risks and regulatory challenges.