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please solve 345and 6 Intel has an opportunity to supply semiconductor integrated circuit boards (sicb) to Hewlett Packard (hp). Hewlett Packard will pay $6 million
please solve 345and 6
Intel has an opportunity to supply semiconductor integrated circuit boards (sicb) to Hewlett Packard (hp). Hewlett Packard will pay $6 million upfront i.e. when the contract is signed and $2.49 million for the first year, $1 million for the second year and $8.5 million in the third year. Intel had obtained loan from Goldman Sachs (an investment bank) prior to the initial payment from hp and invest S4 million from it at the beginning of the project. Subsequently, Intel spend $3 million, $9 million, $3 million, 2.77million, and $3 million as running cost for the first, second, third, fourth and fifth year respectively. Hewlett Packard will take delivery of the semiconductor integrated circuit boards during year 4, and agrees to pay $3 million at the end of that year and the S 5 million balance at the end of year 5. The outcome of the rate of return on this investment as compare with the minimum attractive rate of return (MARR) will determine if Intel will continue to sustain their current staff strength or they will cede to the option of downsizing after the completion of the 5 year deal. Intel management request her project management team to conduct an economic analysis on the proposed venture (project) so that they can be better informed on policy formulation in readiness for any exigency that may result from the project. These exigencies include but not limited to staff downsizing, staff retainment, salary freezing, salary cut or closing down some of their plants since they are multinational company. The project management team is planning to approach the task as follows: 1. Generate a table depicting the cash flow estimates for the Project 2. Draw the cash flow diagram for the cash flow estimates 3. Determine the number of rates of return values this project is likely to have, 4. Obtain the values for the rate of return using Microsoft Excel (Spreadsheet). These values should be obtain by plotting the Present worth against the range of rate of return values (0 % to 100 %, step increase of 5 %). 5. Evaluate the Internal Rate of Return (IRR) for the zero net present worth using Microsoft Excel Spreadsheet 6. Intel management have set a MARR of 15% for any of their project will you advised Intel to embark on this project knowing the net positive cash flow received from Hewlett Packard is reinvested at 14%. The loan Intel obtained from Goldman Sachs for the Intel has an opportunity to supply semiconductor integrated circuit boards (sicb) to Hewlett Packard (hp). Hewlett Packard will pay $6 million upfront i.e. when the contract is signed and $2.49 million for the first year, $1 million for the second year and $8.5 million in the third year. Intel had obtained loan from Goldman Sachs (an investment bank) prior to the initial payment from hp and invest S4 million from it at the beginning of the project. Subsequently, Intel spend $3 million, $9 million, $3 million, 2.77million, and $3 million as running cost for the first, second, third, fourth and fifth year respectively. Hewlett Packard will take delivery of the semiconductor integrated circuit boards during year 4, and agrees to pay $3 million at the end of that year and the S 5 million balance at the end of year 5. The outcome of the rate of return on this investment as compare with the minimum attractive rate of return (MARR) will determine if Intel will continue to sustain their current staff strength or they will cede to the option of downsizing after the completion of the 5 year deal. Intel management request her project management team to conduct an economic analysis on the proposed venture (project) so that they can be better informed on policy formulation in readiness for any exigency that may result from the project. These exigencies include but not limited to staff downsizing, staff retainment, salary freezing, salary cut or closing down some of their plants since they are multinational company. The project management team is planning to approach the task as follows: 1. Generate a table depicting the cash flow estimates for the Project 2. Draw the cash flow diagram for the cash flow estimates 3. Determine the number of rates of return values this project is likely to have, 4. Obtain the values for the rate of return using Microsoft Excel (Spreadsheet). These values should be obtain by plotting the Present worth against the range of rate of return values (0 % to 100 %, step increase of 5 %). 5. Evaluate the Internal Rate of Return (IRR) for the zero net present worth using Microsoft Excel Spreadsheet 6. Intel management have set a MARR of 15% for any of their project will you advised Intel to embark on this project knowing the net positive cash flow received from Hewlett Packard is reinvested at 14%. The loan Intel obtained from Goldman Sachs for the Step by Step Solution
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