Evaluate the financial impact of a new marketing strategy at Nike using NPV, IRR, and payback period
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Question:
Evaluate the financial impact of a new marketing strategy at Nike using NPV, IRR, and payback period methods.
Investment Components | Initial Investment ($) | Annual Cash Flows ($) | Project Life (years) | Discount Rate (%) |
Marketing Strategy | 120,000,000 | 35,000,000 | 4 | 9% |
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 marketing costs.
Provide recommendations on whether to proceed with the marketing strategy.
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