Van Morrison Enterprises can produce products that can be sold 200 units per year for...
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Van Morrison Enterprises can produce products that can be sold 200 units per year for 5 years. Fixed costs are $30,000 per year and variable costs are $1,200 per unit. The project requires an initial investment in machinery of $300,000 and is expected to have a useful life of 5 years. The initial investment will be depreciated straight-line over a five year useful life to an accounting salvage value of $0. Assuming a tax rate of 30% and a discount rate of 10%, answer the questions below: Question 11 10 pts What is the OCF that gives an Economic Break Even? Question 12 5 pts What is the economic break-even price
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