You are looking at a 5-year projecttomarket a new direct-to-consumer genetic test which will sell for $200 and cost you $60 per test to produce.

The project will require $8 million in capital investment up front, all of which is eligible for bonus depreciation, and will have salvage value of $1 million in 5 years.

Your tax rate is 21% and the projectdiscount rateis 15%. Assuming you sell the same number of tests each year, what isthe break-even sales volume (total # of testsover all 5 years)?

1. 82,900
2. 33,400
3. 79,800
4. 35,100
5. 66,900