Question: Jack perfected his safety system that could be installed in every vehicle and will prevent collision. The system includes both hardware and software.The production requires

Jack perfected his safety system that could be installed in every vehicle and will prevent collision. The system includes both hardware and software.The production requires $500 million dollar investment in plant and equipment.The economic life of the plant is 10 years due to fast change in the technology.The investment in plant and equipment will be depreciated over 10 years using a straight-line depreciation method.The assumed salvage value and the actual market value of the plant at the end of 10^thyear are expected to be zero.The marginal tax rate is 35 percent, and the opportunity cost of capital is 10 percent.Each unit will be sold for $5,000 apiece.The direct labor and material cost is $3,000.What is the break even production level for the net income, that is, how many units should be produced to have zero net income?

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