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Required information [The following information applies to the questions displayed below.] These problems relate to the Integrated Analytics Case: Bene Petit. Select the appropriate eBook
Required information [The following information applies to the questions displayed below.] These problems relate to the Integrated Analytics Case: Bene Petit. Select the appropriate eBook link to open the Case Overview, Case Background, and Part 5: Performance Evaluation and Analysis. For this problem, assume that Taylor is considering investing in one or more of the following projects: Project A: Expand the manufacturing facility to increase capacity by 20 percent. This investment is expected to cost $360,000 and generate net cash flow of $80,000 per year for the next eight years. Project B: Overhaul the company website to optimize the user experience and generate more traffic from online advertising. This oroject would cost $200,000 and is expected to generate an additional $100,000 in sales for the next 10 years. Assume that the contribution margin is 42 percent and that there would be no increase in fixed costs, including depreciation. Droject C: Invest in solar panels and more fuel-efficient delivery vehicles to reduce operating expenses (e.g., electricity and fuel) and he company's carbon footprint. The initial investment in assets would be $360,000, which would be depreciated over five years. The nvestment is expected to increase net income by $18,000 per year, after the depreciation adjustment. Required: 1. Compute the payback period for each project. Note: Round your answer to 1 decimal place. 2. Compute the NPV of each project assuming the cost of capital is 10 percent. Note: Round your PV amounts to 4 decimal places. 3. Compute the profitability index of each project. Note: Round your answer to 2 decimal places. 6. If Taylor has a limited amount of capital to invest in these projects, which project should receive the highest priority
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