According to the problem above, what if the cable monthly charges continue to increase, How would the assessment of ongoing investment in this project change? given that the past investment really provides an historical look?

1. From my personal experience using the concept of capital budgeting Analysis of purchasing a television for NPV calculation The following are the assumptions regarding the same Purchase cost = $ 2000 Discount rate = 10 % Calculation for the present value of cost and other cost (in $) B D E F G 1 2 Year 1 Year 2 Year 3 3 Year o $ 2000 M $ 200 $ 100 300 $ 200 $ 100 300 $ 200 $ 100 300 Total $ 2000 $ 600 $ 300 $ 2900 $ 2000 3 4 Particulars 5 Purchase cost 6 Cable Connection charges 7 Other accessories of TV 8 Total Cost 9 10 Present Value of calculation 11 Discount Rate (10%) 12 Present Value factor = 1/(1+r)^n 13 14 Present value of costs 15 16 0.909091 0.826446 0.751315 $ 2000 272.7273 247.9339 225.3944 2476.056 Calculation of present value of benefits in terms of cost from not going outside to watch a movie and watching on the television Particulars Cost saving benefits Present value factor Prsent value of benefits Year 1 $ 1100 0.909090909 1000 Year 2 Year 3 Total $1200 $1300 $3600 0.826446 0.751315 991.7355 976.7092 2968.445 NPV = Present Value of benefits - Present Value of costs Total Year o $ 2000 4 5 6 7 8 9 Particulars Present Value of costs Present Value of benefits NPV Year 1 272.7272727 1000 Year 2 Year 3 247.9339 225.3944 991.7355 976.7092 743.8017751.3148 -2000 727.2727273 222.3891811 3. The factors that contribute to the success of the capital project are as follows 1. Good planning is one of the most important factors that determine the success of the capital project as at this stage vision will be made. 2. Risk assesment of the project must be done. 3. Strategy of the project must be clear and well defined. 4. Cost of the project must be managed effectively and efficiently. 5. Project monitoring and costs management are important for the proper execution of the project. 1. From my personal experience using the concept of capital budgeting Analysis of purchasing a television for NPV calculation The following are the assumptions regarding the same Purchase cost = $ 2000 Discount rate = 10 % Calculation for the present value of cost and other cost (in $) B D E F G 1 2 Year 1 Year 2 Year 3 3 Year o $ 2000 M $ 200 $ 100 300 $ 200 $ 100 300 $ 200 $ 100 300 Total $ 2000 $ 600 $ 300 $ 2900 $ 2000 3 4 Particulars 5 Purchase cost 6 Cable Connection charges 7 Other accessories of TV 8 Total Cost 9 10 Present Value of calculation 11 Discount Rate (10%) 12 Present Value factor = 1/(1+r)^n 13 14 Present value of costs 15 16 0.909091 0.826446 0.751315 $ 2000 272.7273 247.9339 225.3944 2476.056 Calculation of present value of benefits in terms of cost from not going outside to watch a movie and watching on the television Particulars Cost saving benefits Present value factor Prsent value of benefits Year 1 $ 1100 0.909090909 1000 Year 2 Year 3 Total $1200 $1300 $3600 0.826446 0.751315 991.7355 976.7092 2968.445 NPV = Present Value of benefits - Present Value of costs Total Year o $ 2000 4 5 6 7 8 9 Particulars Present Value of costs Present Value of benefits NPV Year 1 272.7272727 1000 Year 2 Year 3 247.9339 225.3944 991.7355 976.7092 743.8017751.3148 -2000 727.2727273 222.3891811 3. The factors that contribute to the success of the capital project are as follows 1. Good planning is one of the most important factors that determine the success of the capital project as at this stage vision will be made. 2. Risk assesment of the project must be done. 3. Strategy of the project must be clear and well defined. 4. Cost of the project must be managed effectively and efficiently. 5. Project monitoring and costs management are important for the proper execution of the project