Calculate the economic breakeven dollar volume of revenue for a project requiring an initial investment of...

Calculate the economic breakeven dollar volume of revenue for a project requiring an initial investment of $3,693,130 and providing annual cash flows equal to 15% of revenue minus annual fixed costs of $250,000. None of the initial investment is recoverable. Assume the project will generate these cash flows for 10 years and the discount rate is 10%.

Expert Solution

Based on the given data, pls find below workings;

Firstly, Net Cash flows have been identified with revenue value at $1;

Once the NPV is arrived, using GOAL SEEK option in excel, have identified the Annual revenue which shall provide the breakeven;

jeff jeffy answered 1 year ago

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