Question 4 20 marks XYZ Ltd, is considering a proposal of training employees at one of reputed management institute for improvement of productivity on account of improved efficiency of employees. following details are collected from concern department. Fee of training programme (per participant) = 15 Lakhs Other costs associated with training programme (per participant) = 22 Lakhs Expected benefits to the firm 1 year 2 year 3 year 4 year Benefits Cost reuduction (Thousands, 50 40 Rs) Increased 90 60 revenue 40 60 60 30 5 year 30 70 70 80 50 (Thousands, Rs) Expected market return = 10% per annum Sigma of market return=20% Risk free rate of return = 8% per annum Total number of employees to be considered for training = 10 It is decided by top management of ABC Ltd, that in first phase only one employee will be sponsored for this training programme. Rest of the employees will be sponsored fo and only if, the performance of first trained employee is as per expectation. Please present your recommendation based on adjusted present value (APV). [20 marks]