A Company Is Considering Investing in a Project,which Requires the Purchase

question 51

Multiple Choice

A company is considering investing in a project,which requires the purchase of a new machine for $250,000.The asset has a six-year life,a CCA rate of 30 percent,and an expected salvage value of $30,000.The selling price of the product is $40 per unit,while the variable cost is $18 per unit and the fixed costs are $50,000 per year.The company's effective tax rate is 40 percent and cost of capital is 10 percent.Assume the asset class remains open after the asset is sold.At what level of sales will the company break even?

• A) 3,102 units
• B) 4,011 units
• C) 5,170 units
• D) 6,685 units

---

Definitions:

Cultural Orientations

A concept involving the values, beliefs, norms, and practices that are shared among members of a society or group.

Health Behaviors

Actions individuals take that affect their health, positively or negatively, such as exercise, smoking, and diet.

Disease Prevention

Measures taken to prevent the occurrence of disease or reduce its impact.

Health Promotion

Activities or interventions aimed at enhancing well-being and preventing health problems by encouraging healthy behaviors.