Homework Help: Managerial Economics

Posted by Karen on Tuesday, December 14, 2010 at 5:18pm.

You are considering setting up a software development business. To set up the enterprise you will need to buy equipment costing $100,000. This equipment will be depreciated straight line over 5 years to a zero salvage value. Its market value at the end of the 5 years will be zero. You will need to rent space at $5,000 per year for the five years of the project. You will also need to hire 5 software engineers at $50,000 each, per year to work in this project. Marketing and selling costs will be $100,000 per year during the project. Materials costs are $20 per unit. You expect to sell 6,000 units of the product each year for the five years. If your tax rate is 40%, and you require a return of 12%, what is the minimum price you should charge per unit of the product?

No one has answered this question yet.

Answer this Question

Related Questions

managerial economics - Help!!! Business Week, in an article dealing with ...
accounting - Jackson Company invests in a new piece of equipment costing $40,000...
Finance - You need to buy 20 computers for your business. You have the option of...
Math - Can you help me set up this problem please P(t) = 100/1+48.2e^-0.52t If ...
Algebra 1 - Can you help me set this up? Suppose you are trying to decide ...
accounting - using the equation A=L+OE how would you balance this problem: You ...
chemistry - I am in need of help about this specific heat question. A 100.0g ...
acounting - TEST XQ's Software Development Division (SDD) has developed ...
accounting - You trade equipment in 2010 and pay a $10,000 cash boot for similar...
accounting question - I have to prepare a general journal entry for a company of...

For Further Reading

First Name:
School Subject:
Answer: