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Problem One A. Year New Coffee Drink New Starbucks 0 -$125,000.00 $1,450,000.00 1 $55,000.00 $410,000.00 2 $70,000.00 $480,000.00 3 $35,000.00 $505,000.00 4 0 $525,000.00 A.If
| Problem One | ||||
| A. | Year | New Coffee Drink | New Starbucks | |
| 0 | -$125,000.00 | $1,450,000.00 | ||
| 1 | $55,000.00 | $410,000.00 | ||
| 2 | $70,000.00 | $480,000.00 | ||
| 3 | $35,000.00 | $505,000.00 | ||
| 4 | 0 | $525,000.00 | ||
| A.If your opportunity cost is 12% for the new coffee drink and 9% for the new starbucks shop. Calculate the NPV, IRR and payback periods for each Project | B.Rank the projects based on NVP,IRR, and payback period. | C. Do the rankings agree? If not. Why? | D. Which investment would you recommend the CFO should Make and Why? |
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International Corporate Finance
Authors: Mark R. Eaker, Frank J. Fabozzi, Dwight Grant
1st Edition
0030693063, 9780030693069
