AmeriTextile Co

question 8

Short Answer

AmeriTextile Co. is considering opening a production and shipping facility in Dallas to keep up with demand for its pillows. The 105,000- square- foot facility will require an initial investment of $280,000, and an annual operating cost of $26,000. It will have a
$74,500 salvage value after 9 years. Calculate the net present worth of this investment if the company's minimum attractive rate of return is 5% per year.

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Definitions:

Market Share

The percentage of total sales or revenue generated by a company or product in a particular market compared to its competitors.

Market Potential

The maximum total sales revenue of all providers within a specific market, assuming complete saturation and optimal selling conditions.

Sales Forecast

The quantity of products a business plans to sell during a future time period.

Market Segmentation

Breaking down populations of people into groups, or target markets.