The BA213 Corporation would like you to perform NPV and IRR analysis for two prospective capital investment projects. The data for these two projects is contained on the Data tab of the Excel workbook provided for this assignment. Assignment Requirements: 1. Use the Excel workbook provided to compute the NPV and IRR of the two initial plans. Format your work using the exhibit on page 1487 of your text as an example. Complete your work for the initial data on the Initial NPV IRR tab of the Excel workbook provided.

2. Recalculate the NPV and IRR of the two plans assuming that the initial cost of the plans will be $5,500,000. Complete your work for these revised numbers on the Revised NPV IRR tab of the Excel workbook provided.

3. Answer the following questions in a Word document: a. Referring to your calculations for the initial project costs, which plan, if any, should the company adopt and why? What qualitative factors other than financial analyses may the company consider in making their decision? Please state at least 3 specific items. b. Explain the relationship between NPV and IRR. Discuss the application of this relationship to the results you obtained for your calculations of the initial plans. c. Considering the results of the analysis with the lower cost (requirement 2): i. If the company has the resources to pursue both plans, what would you recommend? ii. If the company may only pursue one plan, what would you recommend?

4. Submit your Excel and Word documents in your Blackboard/eLearn course assignment area.

Format instructions:

1) Construct your NPV IRR tables using the example format in your text. You must use the formulas in Excel for your calculations. Do not refer to or use the factors provided in the table in your text.

2) Proper text formatting includes attention to bolding, capitalization, cell alignment, and borders.

3) Proper number formatting includes attention to dollar signs, percentage signs, decimal places, borders, and alignment.

BA213 NPV IRR Assignment Data Sheet Project Name BA211 BA212 $ 6,000,000 $ 6,000,000 Initial Cost Yearly Cash Inflows: 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 1,400,000 1,700,000 2,000,000 1,700,000 1,400,000 1,000,000 700,000 400,000 100,000 3,600,000 Required Rate of Return 20% 20%