Question
### will upvote thank you! ### 1. Walmart wants to test a new scanner on their sorter. The initial investment of the machine will be
### will upvote thank you! ###
1. Walmart wants to test a new scanner on their sorter. The initial investment of the machine will be $2.5 million and the benefit due to cost savings will be $900,000 per year. Maintenance on the machine will cost $75,000 per year and they plan for major maintenance in year 7 of $500,000. At the end of the 10 year project life, they are able to sell parts to another warehouse for $600,000. If the MARR is 11% what is the AEW of this project?
2. T-pain want to start selling an energy drink to make you run faster and jump higher, and it will come in a heavy duty bottle in case someone throws it on the ground. He initially invest $3,800,000 into initial product R&D and will need to pay $45,000 per year for product quality and maintenance which they expect to go up by 6% per year due to pending inflation . T-pain's genius business plan is to sell this drink for 8 years and aims to see returns of 18%. If each bottle has a gross margin of $1.31, approximately how many bottles do they need to sell every year to breakeven?
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