Question: Social Circle Publications Inc is considering two new magazine products

Social Circle Publications Inc. is considering two new magazine products. The estimated net cash flows from each product are as follows:

Each product requires an investment of $ 125,000. A rate of 10% has been selected for the net present value analysis.

1. Compute the following for each product:
a. Cash payback period.
b. The net present value. Use the present value of $ 1 table appearing in this chapter (Exhibit 1).
2. Prepare a brief report advising management on the relative merits of each of the twoproducts.

  • CreatedJune 27, 2014
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