Question
General Motors expected the capital expansion of its Ingersoll Ontario CAMI plant to total $800 million (CND). The plant manufactures the next generation Chevrolet Equinox
General Motors expected the capital expansion of its Ingersoll Ontario CAMI plant to total $800 million (CND). The plant manufactures the next generation Chevrolet Equinox and a few other models. Assuming that annual production of 300,000 vehicles, profit of $5,000 on the Equinox, an 8 year production horizon and a 15% discount rate do you think that General Motors made a good investment decision? What other factors should be considered? Look up on the internet the Ingersoll plant and then see if you can find any information in General Motors latest Annual Report Managements Discussion and Analysis or elsewhere in the report to see if the plant is living up to expectations. Complete your calculations in Excel.
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