Contemporary Engineering Economics 6th Edition by Chan Park

تمرين 14

Gene Research, Inc., just finished a four-year program of R D and clinical trials. It expects a quick approval from the Food and Drug Administration. If Gene markets the product on its own, the company will require $30 million immediately ( n = 0) to build a new manufacturing facility, and it is expected to have a 10-year product life. The R D expenditure in the previous years and the anticipated revenues that the company can generate over the next 10 years are summarized in Table.
TABLE 28
Merck, a large drug company, is interested in purchasing the R D project and the right to commercialize the product from Gene Research, Inc.; it wants to do so immediately ( n = 0). What would be a starting negotiating price for the project from Merck Assume that Gene's MARR = 20%.