Question
Perform a financial analysis for a project using the format provided in Figure 4-5. Assume that the projected costs and benefits for this project are
Perform a financial analysis for a project using the format provided in Figure 4-5. Assume that the projected costs and benefits for this project are spread over four years as follows: Estimated costs are $400,000 in Year 0 and $50,000 each year in Years 1, 2, and 3. Estimated benefits are $0 in Year 0 and $180,000 each year in Years 1, 2, and 3. Use a 6 percent discount rate, and round the discount factors to two decimal places. Create a spreadsheet to calculate and clearly display the NPV, ROI, and year in which payback occurs. Do not discount the cost and benefit in Year 0. The discount costs and benefits must start from Year 1. In addition, write a paragraph explaining whether you would recommend investing in this project, based on your financial analysis. You need to provide the developed spreadsheet for this question.
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