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Class Project Assignment is: Caterpillar Company has an opportunity to supply Heavy Duty Trucks to Skanska, a Swedish construction company based in the United States.

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Class Project Assignment is: Caterpillar Company has an opportunity to supply Heavy Duty Trucks to Skanska, a Swedish construction company based in the United States. Skanska will pay $2 million when the contract is signed and $1.2 million one year later. Caterpillar obtained a loan from JP Morgan, an investment bank, in its second-and third-year which result in net cash flows at $4 million and 3 million respectively each when the truck is being produced. Skanska will take delivery of the truck during Year 4, and agrees to pay $2 million at the end of that year and the $ 0.5 million balance at the end of year 5. This project will answer the following questions Generate a table depicting the cash flow estimates for the Project Draw the cash flow diagram for the cash flow estimates Determine the number of rates of return values this project is likely to have. Obtain the values for the rate of return using Microsoft Excel (Spreadsheet). These values should be obtain by plotting the Present worth against the range of rate of return values (0 % to 80 %, step increase of 10 %) Caterpillar management have set a MARR of 15% for any of their project; will you advised Caterpillar to embark on this project knowing the net positive cash flow received from Skanska is reinvested at 30 %. The loan Caterpillar obtained from JP Morgan for the production of the Truck is borrowed at a rate of 10 %. You will prepare a three-page report and a two-page appendix containing the Excel spread sheet analysis Report due on or before 12/01/2016

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