Given the Following Information, Calculate the Present Value Break-Even Point

question 24

Multiple Choice

Given the following information, calculate the present value break-even point. Fixed costs: $2000/year. (Initial investment $2000) .
Variable costs: $6/unit.
Depreciation: $250/year.
Price: $20/unit.
Discount rate: 10%.
Project life: 4 years.
Tax rate: 34%.

• A) 100 units/year.
• B) 143 units/year.
• C) 202 units/year.
• D) 286 units/year.

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Definitions:

Independent Events

Two or more events where the occurrence of one event does not affect the probability of the others.

Different Times

Various points or periods in time, indicating a range of temporal instances or durations.

Marginal Utility

The heightened utility one obtains from the consumption of an extra unit of a particular good or service.

Income

Income earned, particularly when it's consistent, from work or investment returns.