Evaluate the feasibility of investing in a new manufacturing plant for Walmart Inc. Conduct a capital budgeting analysis using net present value (NPV), internal rate of return (IRR), payback period, and profitability index (PI) methods. Consider the initial investment, expected cash flows, depreciation expenses, and discount rate. Recommend whether Walmart should proceed with the investment based on your analysis.
Values:
•Initial Investment: $50,000,000
•Expected Annual Cash Flows: $10,000,000
•Project Lifespan: 10 years
•Discount Rate: 12%