You are the financial analyst at Wellington Laboratories Ltd,a new Orleans, USA baked bulk drugs manufacturer...

 

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You are the financial analyst at Wellington Laboratories Ltd,a new Orleans, USA baked bulk drugs manufacturer that is evaluating the following the project manufacturing a new compound. Year Cash Flow 0-34000 1 16000 2 18000 3 8000 412000 5 7000 The required rate of return for the company is 20 percent. a. Calculate the payback period of the project. Should the firm accept the project? why or why not? b. Calculate the discounted payback period of the project, should the firm accept the project? why or why not? c. Calculate the NPV of the project, Should the firm accept the project? Why or Why not? You are the financial analyst at Wellington Laboratories Ltd,a new Orleans, USA baked bulk drugs manufacturer that is evaluating the following the project manufacturing a new compound. Year Cash Flow 0-34000 1 16000 2 18000 3 8000 412000 5 7000 The required rate of return for the company is 20 percent. a. Calculate the payback period of the project. Should the firm accept the project? why or why not? b. Calculate the discounted payback period of the project, should the firm accept the project? why or why not? c. Calculate the NPV of the project, Should the firm accept the project? Why or Why not?

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The detailed answer for the above question is provided below SOLUTION a Payback period calculation C... View the full answer