• Amazon is considering expanding its logistics network with a new distribution center and has provided the following financial projections:
  • Initial Investment: $2 billion
  • Estimated Annual Revenue: $800 million
  • Operating Costs: $500 million annually
  • Depreciation Expense: $150 million annually
  • Tax Rate: 22%

• Requirements:
  1. Calculate the annual net income from the new distribution center.
  2. Prepare a five-year financial projection for the new distribution center.
  3. Analyze the impact on Amazon’s operating profit margin.
  4. Discuss the strategic benefits of the new distribution center for Amazon’s logistics operations.
  5. Evaluate the potential risks and challenges associated with the new distribution center.