9.9
Chapter 9 | |||
Question 9 | |||
Input area: | |||
Sales price | $ 52.25 | ||
Variable costs | $ 14.60 | ||
Fixed costs | $ 580,000 | ||
Depreciation | $ 65,000 | ||
Tax rate | 21% | ||
Discount rate | 13% | ||
Initial investment | $ 455,000 | ||
Life of project | 7 | ||
Output area: | Complete the empty boxes below. | ||
Accounting breakeven | |||
EAC | |||
Financial breakeven |
9.12
Chapter 9 | |||||
Question 12 | |||||
Input area: | |||||
Initial fixed assets | $ 385,000 | ||||
Life of project (yrs) | 4 | ||||
Price | $ 26 | ||||
Variable costs | $ 17 | ||||
Fixed costs | $ 395,000 | ||||
Quantity sold | 73,000 | ||||
Tax rate | 22% | ||||
Change in quantity | 1,000 | ||||
Output area: | Complete the empty boxes below. | ||||
OCF at | units | ||||
OCF at | units | ||||
Cash flow sensitivity |
9.21
Chapter 9 | ||||||||||
Question 21 | ||||||||||
Input area: | ||||||||||
Cash offered today | $ 50,000 | |||||||||
Percentage of profits offered | 1% | |||||||||
Probability script is bad | ||||||||||
and is not made into a movie | 90% | |||||||||
Probability a movie is made | ||||||||||
and the movie is bad | 70% | |||||||||
Payoff if movie is good | $ 120,000,000 | |||||||||
Output area: | Complete the empty boxes below. | |||||||||
Value if movie is good and there is a big audience | ||||||||||
Value if movie is good, there is a big audience, and the script is good | ||||||||||
Percentage of profits if movie is good, there is a big audience, and the script is good | ||||||||||
Big audience | ||||||||||
Probability = | Payoff = | |||||||||
Movie is good | ||||||||||
Probability = | Make movie | |||||||||
Script is good | Movie is bad | |||||||||
Read script | Probability = | Small audience | ||||||||
Script is bad | Payoff = | |||||||||
Probability = | Don’t make movie | |||||||||
No profit | ||||||||||
The screenwriter should take |
9.25
Chapter 9 | |||||
Question 25 | |||||
Input area: | |||||
Life of project | 5 | ||||
Discount rate | 13% | ||||
Tax rate | 23% | ||||
Pessimistic | Expected | Optimistic | |||
Market size | 81,000 | 97,000 | 112,000 | ||
Market share | 14% | 17% | 19% | ||
Selling price | $ 110 | $ 116 | $ 119 | ||
Variable costs per year | $ 38 | $ 36 | $ 34 | ||
Fixed costs per year | $ 615,000 | $ 575,000 | $ 550,000 | ||
Initial investment | $ 1,550,000 | $ 1,450,000 | $ 1,350,000 | ||
Output area: | Complete the table below. | ||||
Pessimistic | Expected | Optimistic | |||
Units per year | |||||
Revenue | |||||
Variable costs | |||||
Fixed costs | |||||
Depreciation | |||||
EBT | |||||
Tax | |||||
Net income | |||||
OCF | |||||
NPV |