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2001 2002 year 1 year 2  key assumptions  unit sales 2000 inflation rate 2.00% real cost of capital 11.00% tax rate 35.00% discounting  discounting = cost of capital 13.22% cumulative discount factor 13.22% Price or cost/unit  sales revenue/ unit $9.70  Variable cost/unit $7.40  cash Fixed Costs $5,280  Cash flow Forecast sales revenue $19,400.00  variable costs  $14,800.00  Gross margins $4,600.00  Cash fixed costs $5,280  depreciation  1621 total fixed cost $6,901  operation Profit ($2,301.00) Taxes ($805.35) Net Profit  ($1,495.65) add back depeciation 1621 operating cash flow $125.35  investment in plant & equip. ($11,350.00) cash flows ($11,350.00) $125.35  present value of each cash flow ($11,350.00) -11224.65 net present value $6,117.00 
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2003 2004 2005 2006 2007 year 3 year 4 year 5 year 6  year 7 4000 5600 6800 7400 3700 1,800 2.50% 3.00% 3.50% 4.00% 4.00% 4.00% 11.20% 11.40% 11.60% 11.80% 12.00% 12.20% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 13.98% 14.74% 15.51% 16.27% 16.48% 16.69% 29.05% 48.07% 71.03% 98.86% 131.64% 170.29% 7.59 10.24 10.6 11.02 11.46 11.92 7.59 7.81 8.09 8.41 8.75 9.1 5412 5412 5574 5769 6000 6240 $30,340.00  $57,344.00  $72,080.00  $81,548.00  $42,402.00  $21,456.00  $30,360.00  $43,736.00  $55,012.00  $62,234.00  $32,375.00  $16,380.00  ($20.00) $13,608.00  $17,068.00  $19,314.00  $10,027.00  $5,076.00  $5,412  $5,412  $5,574  $5,769  $6,000  $6,240  1621 1621 1621 1621 1621 1621 $7,033  $7,033  $7,195  $7,390  $7,621  $7,861  ($7,053.00) $6,575.00  $9,873.00  $11,924.00  $2,406.00  ($2,785.00) ($2,468.55) $2,301.25  $3,455.55  $4,173.40  $842.10  ($974.75) ($4,584.45) $4,273.75  $6,417.45 
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