Thanks to an investment of $200,000 for a new injection machine, A-Design Inc., a company specializing in the design and manufacture of disadvantages for wheelchairs managed to make an operating profit from $42,000 in its first year of production. Expenses financing (interest) on the money that A-Design has borrowed amount to $8,000 per year.*

1. Calculate the net profit of the company for a rate 20% tax. 2. Determine the return on investment of the company for its new injection machine. 3. What is the simple return period (in years) for the investment compared to the injection machine? 4. For a unit net profit of $20 per armrest, how much of armrests must sell A-Design to reach its break-even point in relation to the investment? 5. Analyse the sensitivity of the net profit of ADesign for a tax rate of 15% and 25%.