Question
In: Finance
11.After you have graduated from the School of Business at Macau University of Science and Technology,...
11.After you have graduated from the School of Business at
Macau University of Science and Technology, you are dedicated to
establish your own start-up business. You have identified two
mutually independent business projects with estimated cash flows as
listed below. In the same industry and with similar business risks,
both projects need the same amount of initial investment. These two
projects are mutually exclusive, because you are subject to time
constraint and financial budgets. You can take loans from
commercial banks and the cost of capital is about 10%.
Year A B
0 -1000 -1000
1 200 600
2 200 558
3 200
4 200
5 600
On the basis of the information provided above, how will you
make your investment decision?
A.Invest in Project A
B.Invest in Project B
C.Invest in Project A and Project B simultaneously
D.Either one is good decision of start-up investment.
E.None of above.
Solutions
Expert Solution
Solution:-
To Calculate NPV of the Project-
As NPV of both Projects are greater than zero. NPV is acceptable when NPV of project is greater than or equal to zero. So choose Both Projects.
The Correct Answer is Point C i.e. Invest in Project A and Project B simultaneously.
jeff jeffy answered 1 year agoRelated Solutions
Introduction to law and Science You and a friend from University have an idea for a...
Introduction to law and Science
You and a friend from University have an idea for a new
invention. In order to develop your idea into a commercially viable
product, you have decided to go into business together. Compare an
unincorporated partnership and an incorporated private limited
company (Ltd). Specify which format you would choose, setting out
arguments in favour of your choice.
You may use whichever referencing style you prefer, just ensure
that you are consistent throughout your answer.
Your...
New Product Analysis You have recently graduated from a University with a BBA degree, and you...
New Product Analysis
You have recently graduated from a University with a BBA degree,
and you have taken a job with a local manufacturing company. Your
boss has asked you to analyze a potential new product, and to
recommend if the company should produce and sell the product.
Specifically, your boss wants you to prepare a spreadsheet that
shows the free cash flows the product would generate, and shows
what the product’s net present value and internal rate of return...
7. The National Technology Readiness Survey sponsored by the Smith School of Business at the University...
7. The National Technology Readiness Survey sponsored by
the
Smith School of Business at the University of Maryland
surveyed 418 randomly sampled Americans, asking them how often they
delete spam emails. In 2004, 23% of the respondents said they
delete spam mail once a month or less, and in 2009 this value was
16%.
(a) What are the hypotheses for evaluating if the proportion
of those who delete their email once
a month or less has changed from 2004 to...
You have just graduated from the MBA program of a large university, and one of your...
You have just graduated from the MBA program of a large
university, and one of your favorite courses was “Today’s
Entrepreneurs.” In fact, you enjoyed it so much you have decided
you want to “be your own boss.” While you were in the master’s
program, your grandfather died and left you $1 million to do with
as you please. You are not an inventor and you do not have a trade
skill that you can market; however, you have decided...
You have just graduated from the MBA program of a large university, and one of your...
You have just graduated from the MBA program of a large
university, and one of your favorite courses was Today’s
Entrepreneurs. In fact, you enjoyed it so much you have decided you
want to “be your own boss.” While you were in the master’s program,
your grandfather died and left you $1 million to do with as you
please. You are not an inventor, and you do not have a trade skill
that you can market; however, you have decided...
You have just graduated from the MBA program of a large university, and one of your...
You have just graduated from the MBA program of a large
university, and one of your favorite courses was “Today’s
Entrepreneurs.” In fact, you enjoyed it so much you have decided
you want to “be your own boss.” While you were in the master’s
program, your grandfather died and left you $1.5 million to do with
as you please. You are not an inventor, and you do not have a trade
skill that you can market; however, you have decided...
You have recently graduated from university and have accepted a position with Sea-Jewels Inc., the manufacturer...
You have recently graduated from university and have accepted a
position with Sea-Jewels Inc., the manufacturer of a popular
consumer product. During your first week on the job, the
vicepresident has been favourably impressed with your work. She has
been so impressed, in fact, that yesterday she called you into her
office and asked you to attend the executive committee meeting this
morning to lead a discussion on the variances reported for last
period. Anxious to favourably impress the executive...
You have recently graduated from university and have accepted a position with Sea-Jewels Inc., the manufacturer...
You have recently graduated from university and have accepted a
position with Sea-Jewels Inc., the manufacturer of a popular
consumer product. During your first week on the job, the
vicepresident has been favourably impressed with your work. She has
been so impressed, in fact, that yesterday she called you into her
office and asked you to attend the executive committee meeting this
morning to lead a discussion on the variances reported for last
period. Anxious to favourably impress the executive...
You have recently graduated from university and have accepted a position with Sea-Jewels Inc., the manufacturer...
You have recently graduated from university and have accepted a
position with Sea-Jewels Inc., the manufacturer of a popular
consumer product. During your first week on the job, the
vicepresident has been favourably impressed with your work. She has
been so impressed, in fact, that yesterday she called you into her
office and asked you to attend the executive committee meeting this
morning to lead a discussion on the variances reported for last
period. Anxious to favourably impress the executive...
You have recently graduated from school and have started your new job at a Consulting LLC....
You have recently graduated from school and have started your
new job at a Consulting LLC. You have been given the following
assignment. You are to present an investment analysis of a new
residential income producing property an investor is considering
purchasing. The asking price for the property is $1,200,000; rents
are estimated at $201,000 during the first year and are expected to
grow at 3.5% per year thereafter. Vacancies and collection losses
are expected to be 11 percent of...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- With four Boolean inputs mentioned in the first four columns of the following table, report the...
- a. In your own words, define the concept of "Recursion" in terms of C++ programming. b....
- Write a program that creates a two-dimensional array initialized with test data. Use any primitive data...
- Write a java project that reads a sequence of up to 25 pairs of names and...
- The basic purpose of the United States legal system is to ensure fairness in balancing individual...
- How has the digital age changed culture? Apply one of the basic sociological perspectives to support...
- Complete drug card- Generic /brand name Category class expected Pharmacological Action Complications Contraindications/Precautions Interactions Medication Administration...
ADVERTISEMENT