What Is the Economic Break-Even Level of Sales for a Project

question 44

Multiple Choice

What is the economic break-even level of sales for a project costing $4,000,000 and generating annual cash flows equal to 0.30 × sales − $450,000? Assume the project will last 10 years and require a discount rate of 12%.

• A) $2,093,654
• B) $2,359,047
• C) $3,859,789
• D) $13,783,333

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Definitions:

Pertaining To

Referring to or relating to a particular subject.

Kyphosis

A condition characterized by an excessive outward curvature of the spine, causing a hunched back.

Lordosis

A curvature of the spine that results in an exaggerated inward curve, typically in the lower back, which can cause discomfort or pain.

Ankylosis

The abnormal stiffening and immobility of a joint due to the fusion of the bones.