Question
Evaluate the financial impact of a new healthcare initiative at Johnson & Johnson using NPV, IRR, and payback period methods. Investment Components Initial Investment ($)
Evaluate the financial impact of a new healthcare initiative at Johnson & Johnson using NPV, IRR, and payback period methods.
Investment Components | Initial Investment ($) | Annual Cash Flows ($) | Project Life (years) | Discount Rate (%) |
Healthcare Initiative | 250,000,000 | 60,000,000 | 5 | 5% |
Requirements:
Calculate NPV and IRR based on projected cash flows and discount rate.
Determine the payback period for the investment.
Conduct a sensitivity analysis to assess the impact of changes in healthcare costs.
Provide recommendations on whether to proceed with the healthcare initiative.
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