The owners of the nuclear power plant in Example 16.6 want a break even point of five years. To do this, they decide to raise the price of the electricity they sell. For how much do they need to sell the electricity in order to meet the BEP?

One “long horizon” industry is the electric power industry. In Example 16.2, our 1,000 MW nuclear power plant costs $8.02 billion, a very large sum of money. Yet its product sells for about 10 cents per kWh. What is its best possible6 BEP after it starts to produce electricity?