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You are trying to determine the financial break-even (as we defined in class) market size for the following project. Your initial investment cost is $150
You are trying to determine the financial break-even (as we defined in class) market size for the following project. Your initial investment cost is $150 million, and that investment will depreciate in straight-line form over the 20-year life of the project. There are no new NWC requirements, and there will be no salvage value at the end of the 20 years. The tax rate is 25%. The discount rate is 20%. The possible values for Market Share, Price/Unit, VC/Unit, and Fixed Costs are below. Using this information, calculate the financial break-even cash flow. Input your answer in millions of dollars, rounded to the nearest 0.01 (so if your answer is $5,511.000, answer 551) (Do not plug in the assumed break-even CF value from the next question; it will not get you credit here). Pessimistic Expected Optimistic Market Share 4.0% 5.0% 6.0% Price/unit $2350 $2500 $2570 VC/Unit $1900 $1540 $1100 FC $3.5 Million $2 Million $0.5 Million MacBook Pro 80 DD 889 bu 23 FO 01 F7 . 40 ET F * @ & % # 3 $ 4 ) 0 2 5 6 7 8 9 W E R Y U 0
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