Presentation Case 4 speech

Presentation Case 4 speech - Presentation Case 4 Speech...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Presentation Case 4 - Speech Slides 1 to 2 : What is a mutually exclusive project? A mutually exclusive project is where the acceptance to do or participate in one project eliminates the possibility of the other project being accepted or undertaken as well. In this case, Gargorium Ltd, must decide whether to undertake the expansion of either Nursery A or Nursery B, but not both. Slide 3: Define the term Net Present Value (NPV)? Net Present Value is defined as the difference between the initial costs of an investment project, and the sum of current values of projected cash inflows. It is used to determine whether an investment is worth pursuing and likely to offer good returns, that is, the rate of return is greater than the discount or interest rate used to determine the current values of future cash flows. In this case, the Net Present Value is equal to the sum of the present values of the future cash flows given, minus the initial cost of expanding each nursery. Basically, the NPV is higher if: the income amounts (cash flows in) are larger, or if the discount rate is lower. The NPV is lower if the income amounts (cash flows in) are smaller, or if the discount rate is higher Slides 4 to 5: What is the NPV decision rule?
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern