Integrative-Conflicting Rankings The High-Flying Growth Company (HFGC) has been expanding very rapidly in recent years, making its shareholders tic 24%, and HFGC managers believe that 24% is a reasonable figure for the firm's cost of capital to sustain a high growth rato. HFGC's CEO argues that the ce are currently under review. The first is an expansion of the firm's production capacity, and the second project involves introducing one of the firm's existing pro Calculate the NPV for both projects Rank the projects based on their NPV b. Calculate the IRR for both projects Rank the projects based on their IRRs. c. Calculate the PI for both projects. Rank the projects based on their Pls. d. The firm can only afford to undertake one of these investments What do you think the firm should do? a. The NPV of the plant expansion project is $(Round to the nearest dollar) Data table (Click on the icon here in order to copy the contents of the data tabli into a spreadshoot) Year Plant expansion Product introduction 0 $3,700,000 - $400,000 is 5 (Round to the nearest dollar) - X Data table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet) Year Plant expansion Product introduction 0 - $3,700,000 $400,000 1 $2,750,000 $300,000 2 $2,500,000 $275,000 3 $2,500,000 $275,000 4 $2.500.000 $300,000 Print Done ng Growth Company (HFGC) has been expanding very rapidly in recent years, making its shareholders rich in the process. The average annual rate of return on sonable figure for the firm's cost of capital. To sustain a high growth rato, HFGC's CEO argues that the company must continue to invest in projects that offer the of the firm's production capacity, and the second project involves introducing one of the firm's existing products into a new market Canh Hows from each project ojects based on their NPVS Djects based on their IRRS acts based on their Pls e investments. What do you think the firm should do? (Round to the nearest dollar) Data table (Click on the icon here in order to copy the contents of the data table below into a spreadsheet) Year 0 Plant expansion $3.700.000 Product introduction $400,000 anding very rapidly in recent years making its shareholders rich in the process. The average annual rate of return on the stock in the past few years has been To sustain a high growth rate, HFGC's CEO argues that the company must continue to invest in projects that offer the highest rate of return possible. Two projects cond project involves introducing one of the firm's existing products into a new market Cash flows from each project appear in the following table hould do? - X able n the icon here in order to copy the contents of the data table below preadsheet) Year Plant expansion Product Introduction 0 - 53,700,000 - $400,000 1 $2,750,000 $300.000 2 $2,500,000 $275.000 on on $27500
