Question
I need help calculating the internal rate of return (IRR), the profitability index (PI), and the payback period for the spreadsheet below. Can you also
I need help calculating the internal rate of return (IRR), the profitability index (PI), and the payback period for the spreadsheet below. Can you also provide the calculations for these 3 for better understanding? I have included the project synopsis and spreadsheet. The NPV is $12,249,171
Project C: Marketing/Advertising Campaign
A major new marketing/advertising campaign, which will cost $2 million per year and last 6 years.
It is forecast that the campaign will increase sales/revenues and costs of sales by 15% per year.
Annual sales for the previous year were $20 million.
The marginal corporate tax rate is presumed to be 25%.
Being a moderate risk investment, the required rate of return of the project is 10%.
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