$1.$ Determine the Weighted Average Cost of Capital $($WACC$)$ for the project uFlized in assessing its cash profitability.

$2.$ In your role as a financial consultant, do you believe the project possesses financial viability? SubstanFate your response by compuFng the net present value $($NPV$).$

$3.$ Evaluate the project using alternaFve capital budgeFng methods like payback period, internal rate of return $($IRR$),$ and profitability index $($PI$).$ Provide a conclusive recommendaFon regarding the investment decision.

$4.$ If the franchisee opts to provide a discount by waiving the first$-$year admission and registraFon fees to aNract new customers, what impact will it have on profitability and NPV$?$ Elaborate on your numerical findings with a thorough analysis. Do you endorse implemenFng this strategy?

$5.$ Look closely at the consultant's careful analysis of the franchise project. Consider how the consultant's approach to fees and cauFous predicFons might affect how much money the project makes. Talk about the important factors like NPV$,$ keeping fees steady, and why the consultant thinks the project is doable. Share your thoughts on whether you agree with how the consultant sees the project's profitability."Venturing into Early Education: The Greenwood Franchise Decision in New Zealand"

Liam Greenwood sat deep in thought at his office in Wellington, the vibrant capital of New

Zealand. It was July $13,2023,$ and he had recently concluded an in$-$depth discussion with Jack

Robinson, director of the Auckland$-$based Bright Beginnings Education Ltd$.,$ concerning their

franchise model for early childhood education centers. Greenwood was exploring the idea of an

entrepreneurial venture that could provide him with additional income and help him achieve the

dreams he and his wife, Sophie, had envisioned. He was evaluating whether to proceed with the

franchise opportunity offered by Bright Beginnings. The decision loomed large and, not being well$-$

versed in financial matters, Greenwood sought the expertise of a consultant to determine the

project's financial viability, particularly since it would require a significant loan.

Greenwood's Background:

A renowned marketing lecturer with $16$ years of experience at a prestigious business school in

Christchurch, Greenwood had an enduring passion for education and aspired to combine this with

entrepreneurship in a way that would also involve his wife. Sophie was a highly credentialed

educator in her own right and was eager to engage in an enterprise where she could employ her

educational skills and knowledge.

Greenwood's interest was piqued when he came across an advertisement for a franchise

opportunity with Bright Beginnings, which operated a concept$-$based early childhood education

center. The idea of a playschool piqued his interest, and the possibility of establishing a franchise in

Christchurch seemed promising. Despite his excitement and the academic synergy he and his wife

could provide, Greenwood was acutely aware of the challenging competition within the concept$-$

based early learning sector.

Living in a sizable home in an upscale suburb of Christchurch, Greenwood's property had ample

space to accommodate the school, but he was inclined towards renting a space in the area for this

new endeavor.

Early Childhood Education Market in New Zealand:

The market for early childhood education in New Zealand had seen substantial growth, driven by

increased household income and a collective emphasis on quality education. A $2022$ report valued

the New Zealand market at approximately NZD $1$ billion, with anticipated growth of $35\%$ driven by

factors such as enhanced parental understanding of early education, the busy lives of working

parents, and a general willingness to invest in children's educational journeys. The sector was ripe

for growth, especially as it embraced modern educational technology, with significant investments

from private equity and venture capitalists, despite a relatively low regulatory environment. The

sector$\text{'}$s minimal infrastructure needs were especially appealing, more so in smaller cities beyond

Auckland and Wellington.

About Bright Beginnings:

Since its establishment in $1998,$ Bright Beginnings had become a rapidly growing chain of early

childhood education centers across New Zealand, with an ISO $9001$:$2023$ certification and over a

thousand franchises countrywide. Their mission was to foster "bright beginners" who could

adeptly navigate the complexities of modern life through tailored learning programs that

encouraged critical thinking and cultural awareness, with age$-$appropriate activities and a

curriculum that promoted diversity. The founders of Bright Beginnings believed in preparing

children for the digital age's complex career landscape, emphasizing that every child should be

equipped to excel. Their curriculum included a blend of traditional New Zealand games and

advanced educational tools, such as the interactive "speaking pen," which made learning a

cap