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Instructions: Read the information below regarding a fictional situation and then answer all the questions that follow. Write your responses as if an employer will
Instructions: Read the information below regarding a fictional situation and then answer all the questions that follow. Write your responses as if an employer will use your answers to determine whether to hire you for a job for which you have applied. Information: A major automotive manufacturer has announced that it will close a manufacturing plant in Ohio. The manufacturer has seen declines in automobile sales and believes that shutting down the factory will help solidify its financial position. If the plant if shut down, there will be large expenses in the first and third years, but there will also be significant cost savings in the other years, so that the cash flow stream for the proposed shutdown is as follows: Year o -$7,000,000 Year 1 Year 2 $12,000,000 $5,000,000 Year 3 Year 4 $5,500,000 $5,000,000 Year 5 $5,000,000 Cash Flow The manufacturer's cost of capital is 6.5%. 4. What other issues should the manufacturer consider? What other parties' points of view might the manufacturer consider? b. Are all the relevant factors quantifiable? a
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