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maybe I'm missing sth. but shouldn't it be 5.692.500€ maintenance costs per year as before calculated and not 56.925.000€? This would totally change the solution here, right?
Ex-McKinsey Engagement Manager in NYC | Part of the McKinsey Private Equity Practice
Hi Hannes,
You are right, the maintenance number needs to be corrected to EUR ~5.7M. In this case, the project seems financially viable so it would change the way you respond to the question (e.g., you could calculate the payback period and decide whether they would get their investment back quickly enough; also, you could think of what other costs need to be considered besides maintenance, if any).
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Hi Hannes,
Q: Shouldn't it be 5.692.500€ maintenance costs per year
Indeed this seems a typo, the maintenance cost should be €5.692.500 as reported before (56.925*100). This indeed has an impact on the number of years needed to reach breakeven, considering the initial set-up cost.