Determine the number of planes that the company must produce in order to break even, on both
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Determine the number of planes that the company must produce in order to break even, on both accounting basis and NPV basis assuming 6years as life of project. The project initial investment is $900 million, each plane sold for $15.5 million, the variable cost is $8 million each plane, the fixed cost is $150 million, the depreciation uses straight-line method, tax rate is 40% and the company’s cost of capital is 10%. Please explain work as much as possible.
Related Book For
John E Freunds Mathematical Statistics with Applications
ISBN: 978-0134995373
8th edition
Authors: Irwin Miller, Marylees Miller
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