The table here,, gives a detailed forecast of the size of the market by production volume. Assume that KMS expects to capture 10.20% of the market share in 2022 and expects thatpercentage will increase by 0.23% per year. KMS currently has the capacity to produce a maximum of 1,100,000 units. What production capacity will KMS require each year? When will anexpansion become necessary (that is, when will production volume exceed 1,100,000 units)?The Tax Cuts and Jobs Act of 2017 temporarily allowed 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapterand in these problems.KMS's market share for 2022 isData tableunits. (Round to the nearest integer.)(Click on the following icon in order to copy its contents into a spreadsheet.)YearProduction Volume (000 units)Market SizeMarket Share20222023202420252026202710,00010.20%10,350 11,036 11,593 12,130 12,76210.43% 10.66% 10.89% 11.12% 11.35%PrintDone- X

Given Information:KMS expects to capture 10.20% of the market share in 2022, and this percentage…

Answered: The table here,, gives a detailed…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter11: Capital Budgeting And Risk

Section: Chapter Questions

Problem 3P

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The table below gives a detailed forecast of the size of the market by production volume. Assume that KXS expects to capture 10.20% of the market share in 2018 and expects that percentage will increase by 0.24% per year. KXS currently has the capacity to produce a maximum of 1100 thousand units. What production capacity will KXS require each year? When will an expansion become necessary (that is, when will production volume exceed 1100 thousand units)? Year 2018 2019 2020 2021 2022 2023 Production Volume (000 units) Market Size 10,000 10,453 11,048 11,591 12,151 12,728
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Ee 354.
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