Question: Financial Data for Investment Analysis (in $) Initial Outlay : $50,000 Projected Cash Flows : Year 1: $10,000 Year 2: $15,000 Year 3: $20,000 Year

Financial Data for Investment Analysis (in $)

  • Initial Outlay: $50,000
  • Projected Cash Flows:
    • Year 1: $10,000
    • Year 2: $15,000
    • Year 3: $20,000
    • Year 4: $25,000
    • Year 5: $30,000
Required:
  1. Calculate the NPV at an 11% discount rate.
  2. Determine the IRR for the investment.
  3. Compute the Profitability Index.
  4. Assess the viability of the investment based on NPV and IRR.
  5. Perform a sensitivity analysis with a 9% and 13% discount rate.

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