# Your company is considering the introduction of a new product line. the initial investment required…

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**Question:**

7-32. your company is considering the introduction of a new product line. the initial investment required for this project is $500,000, and annual maintenance costs are anticipated to be $35,000. annual operating cost will be in direct proportion to the level of production at $8.50 per unit, and each unit of product can be sold for $50.00. if the project has a life of 7 years, wht is the minimum annual production level for which this project is economically viable? work this problem on an after tax basis. assume 5-year SL depreciation (SV.5 = 0), MV.7 = 0, an effective income tax rate of 40%, and an after-tax MARR of 10% per year. (7.9)

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