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Depreciation and amortization charges are 20000 and the

Chip's Home Brew Whiskey management forecasts that if the firm sells each bottle of Snake-Bite for $20, then the demand for the product will be 15,000 bottles per year, whereas sales will be 83 percent as high if the price is raised 13 percent. Chip's variable cost per bottle is $10, and the total fixed cash cost for the year is $100,000. Depreciation and amortization charges are $20,000, and the firm has a 30 percent marginal tax rate. Management anticipates an increased working capital need of $3,000 for the year. What will be the effect of the price increase on the firm's FCF for the year?

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Finance Basics: Depreciation and amortization charges are 20000 and the

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Finance Basics: Depreciation and amortization charges are 20000 and the

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Finance Basics: Depreciation and amortization charges are 20000 and the

Reference No:- TGS0662594

Recent Questions Asked Finance Basics

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