FIN 486 Week 4 Individual Assignment Capital Budgeting Scenarios
b . Judging on the basis of your findings in part a , what action should Jenny recommend to management with regard to the proposed equipment expenditure ? c . In general , how does this problem demonstrate the importance of considering real options when making capital budgeting decisions ?
P12 – 19 Capital rationing : NPV approach A firm with a 13 % cost of capital must select the optimal group of projects from those shown in the following table , given its capital budget of $ 1 million . LG 6 a . Calculate the present value of cash inflows associated with each project . b . Select the optimal group of projects , keeping in mind that unused funds are costly .
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FIN 486 Week 4 Individual Assignment Capital Budgeting Scenarios
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FIN 486 Week 4 Individual Assignment Capital Budgeting Scenarios Choose a scenario from the Capital Budgeting Worksheet to review and analyze . Using net present value , determine the proposal ’ s appropriateness and economic viability . Prepare a 500-word report explaining your calculations and conclusions . Answer the following in your report :