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Conducting an investment appraisal for a capital project, consider the following data: Category Year 1 ($) Year 2 ($) Year 3 ($) Year 4 ($)
Conducting an investment appraisal for a capital project, consider the following data:
Category | Year 1 ($) | Year 2 ($) | Year 3 ($) | Year 4 ($) | Year 5 ($) |
---|---|---|---|---|---|
Cash Inflows | 40,000 | 45,000 | 50,000 | 55,000 | 60,000 |
Cash Outflows | 70,000 |
Your requirements are as follows:
- Calculate the net present value (NPV) of the investment using a discount rate of 15%.
- Determine the payback period for the investment.
- Present the NPV and payback period calculations in a table format.
- Provide a paragraph discussing the investment's financial viability.
- Discuss the risk factors associated with the investment.
- Include a bullet list of recommendations based on the investment appraisal results.
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