Question 5 please. I am not a finance major, and honestly am completely lost with this whole assignment. I took this class thinking it was something very different. Any and all help is greatly appreciated.

Layout References Mailings Review View Help Share Commen Indent Home Insert Draw Design Breaks 2. Line Numbers gins Orientation Size Columns be Hyphenation Left -0.44" Right: 0" Spacing CE Before Opt After: 0pt Paragraph Align 2. Group Selection Rotate Pane Position Wrap Bring Send Text Forward Backward Arrange Page Setup BUS 3710 Capital Budgeting Problem name You have an idea for a new product that can be developed and sold by your small business. You need to analyze the prospects for success by developing an assumption for cash flows and calculating the potential return on your investment. Here are some of the details. You expect to sell this product for 5 years. After that time there will be no demand for the product. You have estimated earnings before interest, depreciation and taxes at $175,000 for each of the next 5 years. The investment in equipment will cost you $500,000. This is the only investment you need to make. You can depreciate the equipment cost over the 5 years in equal amounts. Your tax rate is 30%. You don't want to invest any of your own money unless you can get a least a 16% return on your investment. The bank has seen your business plan and will loan you 50% of the capital you need for the project at 12%. 1. 2. 3. 4. 5. Calculate the cash flow for each of the 5 years. Calculate the payback period on this project. Using your WACC, calculate the NPV on this project and Profitability Index. Estimate the IRR. Accept? Reject? Cash Flow Projections 1 of 1 298 words C Focus 20 Type here to search O W B 4x 11:43 PM 3/25/2021 Layout References Mailings Review View Help Share Commer 1 Home Insert Draw Design Breaks 2- Line Numbers ins Orientation Size Columns be Hyphenation Left: Indent Spacing -0.44" Before: Opt Right: 0" After: Opt Paragraph 5. Accept? Reject? Align i Group Rotate Position Wrap Bring Send Selection Text Forward Backward Pane Arrange Page Setup Cash Flow Projections 0 1 2 3 4 5 EBITD $175,000 $175,000 $175,000 $175,000 $175,000 Deprec EBIT Interest EBT Taxes CASH FLOW ($500,000) Payback = (round to closest number of years) NPV = Discount rate = %) Profitability Index = IRR = Greater than 14% or Less than 14% Circle one => Accept Reject 1 of 1 298 words Focus 10 Type here to search O w B 4x 11:44 PM 3/25/2021 E