Suppose that in the year 2015, Oceanaire, Inc. planned to produce 500,000 units of its lightweight scuba tanks. Of the 500,000 it planned to produce, a total of 25,000 units would be added to the inventory at its new plant in Arizona. Also assume that these units have been selling at a price of $200 each and that the price has been constant over time. Suppose further that this year the firm built a new plant for $6 million and acquired $3.0 million worth of equipment. It had no other investment projects, and to avoid complications, assume no depreciation. Now suppose that at the end of the year, Oceanaire had produced 500,000 units but had only sold 460,000 units and hat inventories now contained 40,000 units more than they had at the beginning of the year. At $200 each, that means hat the firm added $8,000,000 in new inventory. This year Oceanaire actually invested $. (Enter your response as an integer.)

Suppose that in the year 2015, Oceanaire, Inc. planned to produce 500,000 units of its lightweight scuba tanks. Of the 500,000 it planned to produce, a total of 25,000 units would be added to the inventory at its new plant in Arizona. Also assume that these units have been selling at a price of $200 each and that the price has been constant over time. Suppose further that this year the firm built a new plant for $6 million and acquired $3.0 million worth of equipment. It had no other investment projects, and to avoid complications, assume no depreciation. Now suppose that at the end of the year, Oceanaire had produced 500,000 units but had only sold 460,000 units and hat inventories now contained 40,000 units more than they had at the beginning of the year. At $200 each, that means hat the firm added $8,000,000 in new inventory. This year Oceanaire actually invested $. (Enter your response as an integer.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter10: Capital Budgeting: Decision Criteria And Real Option

Section: Chapter Questions

Problem 14P

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