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Northern Distributors expects a 1 7 % rate of return on their investments. They are considering a 1 5 year project which will cost them
Northern Distributors expects a rate of return on their investments. They are considering a year project which will cost them $ immediately, $ each year for years to $ each year for years to and $ each year for the years to of the project. Should they take on the project if it will return $ at the end of each year for the first years, $ at the end of each year in the next years, and $ at the end of each year for the last years?
a Prepare a fully documented timeline of all cash flows marks
b Calculate the NPV of the project. marks
c Calculate the ROI of the project. marks
d Determine the payback period of the project marks
e Would you go ahead with the project? Whywhy not? marks
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