For your selected company, choose a capital investment project. For example, the company can purchase an MRI, a surgical robot, or IT system. For other ideas, discuss with your classmates and search for technologies that hospitals have been adopting to stay competitive. Answer the following questions:

1. What is your project?

2. Why did you choose this project?

3. What are the non-financial benefits from adopting this project?

4. What are the expected costs and revenues for adopting this project?

5. Calculate the IRR, NPV, and Payout for your project using 10% rate.

Part 2b: Capital Investment Analysis

• For your selected capital project, map out the initial project cost and revenue stream due to the investment over the next 10 years using a timeline. Consider factors such as the cost of the equipment, volume/use of the equipment per year, net revenue from using the equipment, supply, and labor costs. You will need to make several assumptions, so state your assumptions and whenever possible, cite your sources.
• What are the non-financial benefits of adopting such a system? What impact, if any, will this investment have on your other business lines?

Part 2c: Capital Investment Analysis (con't)

With your team, complete final project part 2c. Use the costs and cash flows identified from Part 2a-2b to calculate the NPV, IRR of the investment you selected. Assume a 10% cost of capital.

What is the Expected Rate of Return?

What is the Risk of the investment?

How should the organization mitigate that risk?