How to do the part 2 of this project. Using Excel to do this project.

Fina 3001 Group project 1: Time Value of Money Excel Project Submission Due by 7 Dec (Mon) 10:00 am by email Please use Excel financial functions or algebraic time value of money equations to answer these questions in your spreadsheet. Please type the names of everyone in your group along with section number (10, 11 or 12) at the top. Part I: Capital budgeting decision techniques Fina Pizza Inc. is considering manufacturing and selling two possible Chicken / Vegetable pizzas. The two pizzas require purchase of different types of oven. Each oven has a 4-year expected life. The table below lists the expected cash flows (in millions of dollars) for each proposed pizza and the WACC for each project is 14 percent. Year Chicken pizza Vegetable pizza 0 1 2 3 4 -300 100 200 120 100 -500 150 275 240 160 1. What is the payback period for each proposed pizza? 2. What is the discounted payback period for each proposed pizza? 3. What is the NPV for each proposed pizza? 4. What is the IRR for each proposed pizza? 5. What is the MIRR for each proposed pizza? 6. What is the crossover rate between the two projects? 7. Fina Pizza Inc. feels that they should just concentrate on making and selling only one type of pizza. Which pizza, if any, should Fina Pizza Inc. select in this case? Explain your decision. Part II: CAPM Project The estimation of company betas is normally brushed over in many introductory finance texts. This often leads students to view beta as some magical number and not until later courses in finance that they realize that the choice of different returns, indices and intervals examined can deliver different beta estimates. This internet exercise takes you through the basic calculation of beta using Excel in order to help demystify a company beta. Along the way you will find how to download share price and index data of the internet which can then be manipulated in Excel. Finally, you will tie the concept of beta and the CAPM to stock valuation. The Yahoo Finance site (http://finance.yahoo.com/) has a wealth of financial information on companies and countries from all over the world. Once you arrive at this site you will find a box displaying "Quote lookup" which you need to type in the stock symbol. To download financial data follow the detailed instructions in the text box below: Instructions for Downloading Stock Data In the "Quote lookup" box type in the stock symbol. Click on \"Historical Prices\" from the Quotes section under the \"more on FB\" (for example) column on the right. Click on monthly radio button in the \"Set Date Range\" and enter the date range as instructed below and click Get Prices. The first page of data should now be visible on the screen. Scroll down until you come to the \"Download to Spreadsheet\" link. Save the data to a file, it will be saved as a CSV file. Open Excel and then open the file you saved. At this point you should have seven columns including the; Date, Open, High, Low and Closing share prices for that month, Volume and Adj Close data for each month. 1. First download into Excel the Facebook(FB), DirecTV (DTV), and S&P500 Index (^GSPC) monthly price data for the 3-year period from the July 1, 2012 to June. 30, 2015 using the instructions outlined above. Using the Open and Close price data for each month (the date given is the first trading day for that month: i.e. the open and close for the month of September 2014 will have a date of 9/2/2014) to calculate the monthly percentage holding period returns (=(Close - Open)/Open) for each stock and index where the Open price is the beginning of the month price and the Close is the end of the month price. Notice that both Facebook and DirecTV did not pay dividend during the period of interest. So we do not need to adjust for dividend. You can get rid of the other data provided for each month. You should have 36 monthly returns for each stock and index. 2. What is the average monthly return for each stock and the S&P500 index over the entire time period? Convert each stock's and index's monthly average into an annualized rate by multiplying each stock's monthly average by 12. 3. Calculate the standard deviation of monthly returns for each stock and the index using Excel. 4. Now calculate the beta for each stock using Excel's Slope or Linest function to use estimate the slope of the linear regression line, which is beta. Use the S&P 500 index as the market portfolio in finding beta. 5. Now use the CAPM/SML Equation to estimate each stock's required return. Use 15% as the required market return and 2.6% as the risk-free rate. Would you recommend buying Facebook and/or DirecTV if annualized rates you got from #2 is your expected returns? Explain your