Problem

6. Assume that the following data has been determined for the development and sale of a ne...

6. Assume that the following data has been determined for the development and sale of a new digital thermometer for home use: development cost = $250,000, production investment = $500,000, annual production volume = 20,000 units per year, and the sales lifetime is 7 years. Assuming a variable production cost of $5 per unit, determine: (a) the sales price necessary to break even within 2 years, and (b) the profit expected over the estimated sales lifetime. [A]

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Solutions For Problems in Chapter 10