<\/p>\n
\n1. Payback Analysis<\/p>\n
<\/p>\n
Two new wind-farm tower projects are proposed for a small company<\/p>\n
that installs them in south western Pennsylvania. Project A will<\/p>\n
cost $250,000 to complete and is expected to have an annual net<\/p>\n
cash flow of $75,000. Project B will cost $150,000 to complete and<\/p>\n
should generate annual net cash flows of $52,000. As a small<\/p>\n
company, the owner and senior management team are very concerned<\/p>\n
about their cash flow.<\/p>\n
Use the payback period method and determine which project is better<\/p>\n
from a cash flow standpoint. <\/p>\n
Show your work and include any formulas used to calculate PP. <\/p>\n
\n2. Net Present Value\n<\/p>\n
\nA recent project nominated for consideration at your company has
\na four-year cash flow of $20,000; $25,000; $30,000; and $50,000.
\nThe cost of the project is $75,000.\n<\/p>\n
a. If the required rate of return is 20%, conduct a discounted cash flow<\/p>\n
calculation to determine the NPV.<\/p>\n
\nb. What is the benefit-cost ratio for the project?\n<\/p>\n
\nc. What would the
\nNPV of the above project be if the inflation rate was expected to
\nbe 4% in each of the next four years?\n<\/p>\n
You will be assessed on the correctness of your calculations
\n(40 points) and on presenting your work and results in a
\nprofessional manner (10 points)<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
1. Payback Analysis Two new wind-farm tower projects are proposed for a small company that installs them in south western Pennsylvania. Project A will cost $250,000 to complete and is expected to have an annual net cash flow of $75,000. Project B will cost $150,000 to complete and should generate annual net cash flows of […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_joinchat":[]},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/posts\/268106"}],"collection":[{"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/comments?post=268106"}],"version-history":[{"count":0,"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/posts\/268106\/revisions"}],"wp:attachment":[{"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/media?parent=268106"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/categories?post=268106"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/qualityassignments.net\/wp-json\/wp\/v2\/tags?post=268106"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}