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The world is facing a critical shortage of microchips. To cope with the increased demands,...

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The world is facing a critical shortage of microchips. To cope with the increased demands, Quanta Semiconductors decided to invest RM10 million to set up a new microchip fabrication facility. The facility requires RM1 million of annual operating cost, starting next year. Its operational lifetime is 5 years, with no salvage value. Quanta's corporate MARR is set at 12% per year. a) Draw the cash flow diagram of the investment. (4 marks) b) Determine how much annual revenue must the new facility generate to recover the initial investment and costs plus the required return. (6 marks)

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