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You are considering starting a new factory producing small electric heaters. Each unit will sell at a price of $78. The production cost of each

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You are considering starting a new factory producing small electric heaters. Each unit will sell at a price of $78. The production cost of each heater is $62. The fixed cost of production is $40000. This project has an economic life of 12 years. The project requires an investment of $335000 in plants and equipment. This equipment will be depreciated using a straight line depreciation method to a salvage value of zero. The required rate of return for the project is 11 percent. The marginal corporate tax rate is 21 percent. Based on these assumptions, calculate the number of units at the operating cash flow break-even point. 2256.7920362046.22136.19 You are considering starting a new factory producing small electric heaters. Each unit will sell at a price of $125. The production cost of each heater is $110. The fixed cost of production is $45000. You are expecting to sell 10500 units per year. This project has an economic life of 9 years. The project requires an investment of $555000 in plants and equipment. This equipment will be depreciated using a straight line depreciation method to a salvage value of zero. The required rate of return for the project is 8 percent. The marginal corporate tax rate is 21 percent. Based on these assumptions, calculate the degree of operating leverage (DOL)? 3.1 3.2 3.4 3.3

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