Question
The REV-Sport auto has passed through the concept and initial design phases and is ready for final design and manufacturing. Final development costs are estimated
The REV-Sport auto has passed through the concept and initial design phases and is ready for final design and manufacturing. Final development costs are estimated to be $75 million, and the new fixed costs for tooling and manufacturing are estimated to be $600 million.
The REV-Sport is expected to sell for $30,000. The first year sales for the REV-Sport is estimated to be 60,000, with a sales growth for the subsequent years of 6% per year.
The variable cost per vehicle is estimated to be $22,000.
The discount rate is 5%.
What are the total number cars produced in the 4 years?
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