Question: Consider two mutually exclusive new product launch projects that Nagano Golf is considering. Assume the discount rate for Nagano Golf is 12 percent. (Do not

Consider two mutually exclusive new product launch projects that Nagano Golf is considering. Assume the discount rate for Nagano Golf is 12 percent. (Do not round intermediate calculations. Round your "PI" answers to 3 decimal places (e.g., 32.161) and other answers to 2 decimal places. (e.g., 32.16)) Project A: Nagano NP-30 Professional clubs that will take an initial investment of $700,000 at time0 Next five years (Years 1-5) of sales will generate a consistent cash flow of $300,000 per year Introduction of new product at Year 6 will terminate further cash flows from this project. Project B: Nagano NX-20 High-end amateur clubs that will take an initial investment of $850,000 at Time 0 Cash flow at Year 1 is $250,000. In each subsequent year cash flow will grow at 10 percent per year Introduction of new product at Year 6 will terminate further cash flows from this project. Year NP-30 NX-20 0 -$700,000 50,000 300,000 250,000 300,000 275,000 300,000 302,500 332,750 300,000 366,025 4 300,000 Complete the following table NX-30 NX-20 Payback IRR PI NPV ears ars
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
