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Conduct an investment appraisal for a capital project with the following data: Category Year 1 ($) Year 2 ($) Year 3 ($) Year 4 ($)


  1. Conduct an investment appraisal for a capital project with the following data:

CategoryYear 1 ($)Year 2 ($)Year 3 ($)Year 4 ($)Year 5 ($)
Cash Inflows100,000105,000110,000115,000120,000
Cash Outflows200,000



Requirements:

  • Calculate the net present value (NPV) of the investment using a discount rate of 40%.
  • Determine the payback period for the investment.
  • Present the NPV and payback period calculations in a table format.
  • Discuss the investment's financial viability.
  • Identify risk factors associated with the investment.
  • Provide recommendations based on the investment appraisal results.

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