Strengths and Weaknesses of: Using ROI and Residual Income Using NPV and IRR and the payback period.

Questions:

1. How would you best analyze a company's running shoe division, explain why ROI and Residual Income should be used and how the company might measure future profitability of a new plant being built in a particular sate such as Illinois.

2. Explain how NPV, IRR, and the payback period can be used.