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Question 18 14 pts Calculate Net Present Value (NPV) and Return on Investment (ROI). Assume your discount percentage is 7%. All calculations should use discounted
Question 18 14 pts Calculate Net Present Value (NPV) and Return on Investment (ROI). Assume your discount percentage is 7%. All calculations should use discounted values. Project Athena involves the creation of medical software specific for the emergency department. The initial investment is $500,000 and you believe the software will be done in two years. The first year's investment is $250,000 and the second year's investment is estimated at $300,000. Once the software is installed, you expect to yield savings of $350,000 per year for the following 5 years. The operational costs of the software are $7,000 per year. Which includes backups and a software programmer part time assigned to fix implementation problems. a) What is the expected span of the project? (project useful life) b) What is the Net Present Value for this project? (Use this format: $999,999,999.99) c) Calculating the numbers at the end of the year, what is the Payback Year for this project: d) What is the Return on Investment for the project? (Use this format: 99.99%) MENNES ME a) What is the expected span of the project? (project useful life) b) What is the Net Present Value for this project? (Use this format: $999,999,999.99) c) Calculating the numbers at the end of the year, what is the Payback Year for this project: d) What is the Return on Investment for the project? (Use this format: 99.99%). e) What is the Return on Investment at the end of the 3rd year? (Use this format: 99.99%) f) What is the discount factor for the last year of the project? (Use this format: 9.99) g) If the company has a minimum "required rate of return" in projects of 30%, in your opinion, would you ask your company to invest in this project? (Yes/No)
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