ethics and professional conduct in business

Project Description:

kristen avery was recently hired as a cost analyst by carenet medical supplies inc. one of kristen's first tasks was to perform a net present value analysis for a new warehouse. kristen performed the analysis and calculated a present value index of 0.75. the plant manager, ted, is very intent on purchasing the warehouse because he believes that more storage space is needed. ted asks kristen into his offece and the following conversation takes place
ted: kristen, you are new here, aren't you?
kristen: yes, sir
ted: well kristen, i'm not at all pleased with the capital investment analysis that you performed on this new warehouse. i need that warehouse for my production. if i don't get it, where am i going to place our output?
kristen: hopefully with the customer, sir
ted: now dont get smart with me
kristen: no, really, i was not trying to be disrespectful. my analysis does not support constructing a new warehouse purchasing a warehouse does not add much value to the business. we need to be producing product to satisfy customer orders, not to fell a ware house.
ted: listen, you need to understand something, the headquarters people will not allow me to build the warehouse if the number do not add up. you know as well as i that many assumptions go into your net present value analysis, why don't you relax some of your assumptions so that the financial savings will offset the cost?
kristen: im willing to discuss my assumptions with you. maybe i overlooked something.
ted: good. here is what i want you to do . i see in your analysis that you dont project greater sales as a results of the warehouse. it seems to me, if we can store more goods, then we will have more to sell. thus, logically, a larger warehouse translates into more sales. if you incorporate this into your analysis, i think you will see that the numbers will work out. why dont you work it through and come back with a new analysis. i'm really counting on you on this one. let's get off to a good start together and see if we can get this project accepted.

question: what is your advice to kristen
1.introduction of the problem
2. an in depth explanation of the issues
3. conclusion. what is the advice to kristen? key points
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Price Type: Negotiable

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