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WACC Debt is 75% and Equity is 25% of this firms capital structure. Interest rate on the debt is 7.5%, firms tax rate is 30%. Firms beta is 1.25, Risk Free Rate is 2.0%, Market Return Rate is 11.0%.

Project Investment Outlay, Year 0 - $1,000,000

Project Investment Life 10 years

Project Depreciation - $100,000 / year

Project Salvage Value - $30,000

Working Capital Base of Annual Sales 10%

Expected inflation rate per year 3.0%

Project Tax Rate 30%

Units sold per year 40,000

Selling Price per Unit, Year 1 - $40.00

Fixed operating costs per year excluding depreciation - $175,000

Manufacturing (Variable) costs per unit, Year 1 - $30.00

Capital Analysis Chapters 9, 10, 22 Year: 10 Basc Ca5C Equipment Cost Salvage Value, Year 4 Deprecietion Per Year Units Sold Every Year Sales price per unit, Year 1 Anniual change in sales price, atter Year 1 Varlable cost per unlt (VC), Year 1 Annual change in VC, after Year 1 Fixed Cost (FC), Year 1 Annual change in FC, after Year 1 Praject VACC Tax Rate Sales Expenses: VC FC Depreciation Net Earnings BT Tax [40%) Net Income Salvage Value NOWC Net Cash Flew DCF NPV IRR Profitabilty Index Payback Years 50 S0