A company is looking at launching a new business line and is considering the following options: country A or country B,
Posted: Thu May 05, 2022 8:06 am
A company is looking at launching a new business line and is
considering the following options: country A or country B, with the
following initial investments and expected cash flows:
Product
A
Product
B
II
(initial investment)
650,000
810,000
year 1
310,000
205,000
year 2
200,000
175,000
year 3
50,000
155,000
year 4
150,000
365,000
Where should the company expand, A or B, according to the payback
period and IRR of each project?
Considering that the discount factor is 4%, calculate the net
present value and benefit cost ratio for each project and
advise.
considering the following options: country A or country B, with the
following initial investments and expected cash flows:
Product
A
Product
B
II
(initial investment)
650,000
810,000
year 1
310,000
205,000
year 2
200,000
175,000
year 3
50,000
155,000
year 4
150,000
365,000
Where should the company expand, A or B, according to the payback
period and IRR of each project?
Considering that the discount factor is 4%, calculate the net
present value and benefit cost ratio for each project and
advise.