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PLEASE ASSIST URGENT Consider a five-year investment project that requires an initial investment of R120 000 and will pay out the following at the end
PLEASE ASSIST URGENT
Consider a five-year investment project that requires an initial investment of R120 000 and will pay out the following at the end of each of the five years. Model the project in a spreadsheet and use the spreadsheet to answer the following questions: a. Give the net present value (NPV) and the profitability index (PI) of the project assuming a discount rate of 8% per annum. b. Would you regard the investment as a good investment? Motivate your answer. c. How would your answers to question a and b change if the discount rate is assumed to be 11% ? d. Suppose that possible discount rates are 9%,10%,11%,12%,13%,14%. Perform a sensitivity analysis on the NPV and PI of the project for this range of discount rates. Between which two discount rates does the project change from profitable to unprofitable? Give the NPV and PI values at these two discount rates
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