APITAL BUDGETING ANALYSIS

When you have multiple projects to consider you need to review each one of them to see if they are acceptable (i.e., NPV > $0). Projects with a NPV less than $0 are UNACCEPTABLE.

Part a) Identify all project combinations that are ACCEPTABLE for Global Manufacturing based on the NPV acceptance criterion.

Part b) Since Global's management has imposed a capital budget constraint (called Capital Rationing) of $6,964,900 you must now select those project combinations from Part "a" that DO NOT cost more than the capital budget constraint.

Part c) Which ONE of these AFFORDABLE project combinations identified in part (b) above will MAXIMIZE the corporate value of Global Manufacturing?

Part d) If this maximizing project combination selected part c were implemented how much could the firm expect its corporate value to increase?

IMPORTANT INSTRUCTIONS FOR PARTS A & B

FOR THOSE PROJECT COMBINATIONS THAT ARE ACCEPTABLE: Single click the box with a question mark to put a check mark in the box next to each project combination that you find to be ACCEPTABLE under the NPV selection criteria.

FOR THOSE PROJECT COMBINATIONS THAT ARE NOT ACCEPTABLE: DOUBLE click the box with a question mark to remove the question mark (?) from each box and leave the box blank to indicate each project combination that is NOT ACCEPTABLE. IF YOU DO NOT DO THIS IT WILL BE COUNTED INCORRECT AND I WILL NOT REGRADE YOUR ANSWER BECAUSE YOU DID NOT FOLLOW THESE INSTRUCTIONS.

PART A: Identify all project combinations that are acceptable for Global Manufacturing based on the NPV acceptance criterion. (See IMPORTANT INSTRUCTIONS above on how to enter your answers correctly)

Projects 1 & 3 & 4unanswered Projects 3 & 4unanswered Projects 1 & 2 & 4unanswered Projects 2 & 4unanswered Projects 2 & 3unanswered Projects 2 & 3 & 4unanswered Projects 1 & 3unanswered Projects 1 & 4unanswered Projects 1 & 2 & 3 & 4unanswered Projects 1 & 2 & 3unanswered Projects 1 & 2unanswered

PART B: Since Global's management has imposed a capital budget constraint (called Capital Rationing) of $6,964,900 you must now select those project combinations from Part "a" that DO NOT cost more than the capital budget constraint. (See IMPORTANT INSTRUCTIONS above on how to enter your answers correctly)

Projects 1 & 3 & 4unanswered Projects 3 & 4unanswered Projects 1 & 3unanswered Projects 1 & 2unanswered Projects 2 & 3unanswered Projects 1 & 2 & 3unanswered Projects 1 & 2 & 3 & 4unanswered Projects 1 & 2 & 4unanswered Projects 1 & 4unanswered Projects 2 & 4unanswered Projects 2 & 3 & 4unanswered

PART C: Which ONE of these AFFORDABLE project combinations identified in part (b) above will MAXIMIZE the corporate value of Global Manufacturing? (Select ONLY ONE project combination)	(Click to select) #1 & #2 & #3 & #4 #1 & #2 & #3 #1 & #2 & #4 #2 & #3 & #4 #1 & #2 #1 & #3 #1 & #4 #2 & #3 #3 & #4 #2 & #4
PART D: If this maximizing project combination selected part c were implemented how much could the firm expect its corporate value to increase? (Round your answer to the nearest whole dollar.)	$