Order the answer to: A large project requires an investment of $200

Best Writers business-economics Order the answer to: A large project requires an investment of $200

business-economics

Order the answer to: A large project requires an investment of $200

Question A large project requires an investment of $200 millions. The construction will take 3 years: $30 million will be spent during the first year, $100 million during the second year and $70 million during the third year of construction. Two project operation periods are being considered: 10 years with the expected net profit of $40 million per year and 20 years with the expected net profit of $32.5 million per year. For simplicity of calculations it is assumed that all cash flows occur at end of year. The company minimum required return on investment is 10%. Calculate for each alternative: (a) The payback periods (b) The total equivalent investment cost at the end of the construction period (c) The equivalent uniform annual worth of the project (use the operation period of each alternative) Make your recommendations based on the foregoing economic parameters.
Subject business-economics
Ready to try a high quality writing service? Get a discount here