NAML: Trump Inc. is in its annual Capital Budgeting review p investment opportunities and gathered information for each company has decided to use a hurdle rate of 11.50% for all pro want as determined that for any project to be accepted, it must first na ess than 4.00 years and must have a positive NPV based on the huraietan company has decided to ration the amount of capital for new projects at $1,000,000 " review process. The company has searched for ormation for each of the 5 proposals listed below. The e of 11.50% for all proposals being considered. project to be accepted, it must first have a Payback e a positive NPV based on the hurdle rate. Lastly, the mount of capital for new projects at a maximum of The Investment for each project is assumed to be at for each project is assumed to be at time 0. The Cash Flows for each project are assurned to occur at the end of the year stated, Cash Flows beyond 7 years are not conside to the increased uncertainty of these potential future cash flows. Calculate the Payback Period in years for each project. Calculate the NPV for each project in the Capital Budgeting Decision Form at the bottom of this assignment. NOTE: You must show your work for each calculation to receive credit. I. Investment required = $200,000. Cash Flows = Year 1 = $45,000 2 = 50,000 3 = 55,000 4 - 60,000 5 = 65,000 6- 75,000 7 = 75,000 Also in year 7 = Project shut-down cost estimated at the end of year 7-$10,000 NOTE: Investments II & III are mutually exclusive. Management has determined that these projects represent the most important investment option for the coming year. If one of these is acceptable, it will be the first project approved for the coming year. II. Investment Required = $250,000. Cash Flows = Year 1 = $38,000 2 = 50,000 3 = 55,000 4 = 55,000 5 = 60,000 6 = 65,000 7 = 70,000 III. Investment Required = $350,000 Cash Flows - $90,000 per year for years 1-7. IV. Investment Required = $400,000. Cash Flows = Year 1 = $75,000 2 = 100,000 3 = 125,000 4 - 150,000 5 - 100,000 6 Also in year 6 = $25,000 in costs to shut-down the project at the end of year V. Investment Required - $700,000. Cash Flows $185,000 per year for years 1-7. Capital Budgeting Decision Form for Trump, Inc. Project Payback Period NPV Accept/Reject