You will bid to supply three jets per year for each of the next three years to the Canadian Armed Forces. To get set up, you will need $10 million in equipment, which belongs in a 30% CCA class and will have no salvage value. Total fixed costs per year are $5 million, and variable costs are $7 million per jet. Assuming a tax rate of 30% and a required return of 10%, what is the minimum price at which you should offer to supply the jets? (You can use half year or AlIP CCA rules for this question.

Take your answer and use the closest larger number below)

a.$5 million each

b.$6 million each

c. $9 million each d.

• $11 million each

e. $32 million each