Tropetech inc. has an expected net operating profit after taxes, ebit(1 – t), of $1,200 million in the coming year. in addition, the firm is expected to have net capital expenditures of $180 million, and net operating working capital (nowc) is expected to increase by $15 million. how much free cash flow (fcf) is tropetech inc. expected to generate over the next year?

You are the owner of a local honda dealership. unlike other dealerships in the area, you take pride in your “no haggle” sales policy. last year, your dealership earned record profits of $1.5 million. however, according to the local chamber of commerce, your earnings were 10 percent less than either of your competitors. in your market, the price elasticity of demand for midsized honda automobiles is 4.5. in each of the last five years, your dealership has sold more midsized automobiles than any other honda dealership in the nation. this entitled your dealership to an additional 30 percent off the manufacturer’s suggested retail price (msrp) in each year. taking this into account, your marginal cost of a midsized automobile is $11,000. what price should you charge for a midsized automobile if you expect to maintain your record sales?