Taj Mahal Tour Company Proposes to Invest $3 Million in a New

Multiple Choice

Taj Mahal Tour Company proposes to invest $3 million in a new tour package project. Fixed costs are $1 million per year. The tour package costs $500 and can be sold at $1500 per package to tourists. This tour package is expected to be attractive for the next five years. If the cost of capital is 20%, what is the NPV break-even number of tourists per year? (Ignore taxes, give an approximate answer)

A) 1000
B) 2000
C) 15000
D) None of the above