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darriennichole
darriennichole
14.03.2020 • 
Business

Today you are considering to run a campus printer business for all 4 years whileyou are in college which you will start exactly 1 year from now (t= 1). To start this businessyou have to purchase 4 industrial printers for $10,000 each today (t= 0). Each printer isgoing to depreciate (real terms) to $2,000 in 4 years. To run your business you estimate thateach year you will need to purchase 12 ink cartridges for each printer for $100 each (nominalterms). Each printer will also generate $100 (nominal terms) in electrical costs per year.The resale value of each printer will be $3,000 (real terms). You plan to charge $0.01 (onecent, real terms) per page. How many pages do you need to print each year to break even?Please record your answer in millions using 2 digits after the decimal. The tax rate is 20%,the nominal discount rate is 10%, and the rate of inflation is 2% (you should use a shortcutr=R+ito find the real rate).

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