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Explain using examples how the avoidance of cognitive dissonance can affect the investors decision making process. (5 Marks) Karatazi Ltd, which has a cost of
- Explain using examples how the avoidance of cognitive dissonance can affect the investors decision making process. (5 Marks)
- Karatazi Ltd, which has a cost of capital of 12 per cent, is considering the investment of Kshs. 7m in an improved moulding machine project with a life span of four years.
The garden ornaments produced will retail at Kshs. 9.20 each and cost Kshs. 6 each to make. It is expected that 800,000 ornaments will be sold each year.
Required:
Using sensitivity analysis determine the key variables to this investment for the project?
(10 Marks)
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