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Question 1 With the current pandemic situation, telecommunications have been important for all household. Therefore, Malaysian telecommunication provider has set new system bandwidth, monitoring and

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Question 1 With the current pandemic situation, telecommunications have been important for all household. Therefore, Malaysian telecommunication provider has set new system bandwidth, monitoring and traffic analysis. The cost of setting up is RM10 million. By setting up this bandwidth monitoring and traffic analysis the cash inflow is expected to increase to RM1.5 million for the next 5 years. After 5 years, the pandemic has been predicted to be resolved and the provider decided to terminate the system by selling of the system at the salvage value of RM5 million. The system project has a cost of capital of 5 percent. (a) Calculate the payback period. (1 marks) (b) Calculate the discounted payback period. (5 marks) (c) Calculate the profitability index of this system and should the provider invest in this new system. (4 marks) Ancor

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