You are the financial analyst for the University of South Carolina's athletic department. As part of...
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You are the financial analyst for the University of South Carolina's athletic department. As part of its master facilities plan, the department's chief financial officer has asked you to analyze a capital investment, a new stadium remodel. The project cost $15,000,000, and the cost of capital is 8.75%. The project's expected to increase revenue by $1,500,000 in year one and then increase by 2% each year into year 30. The stadium will have to be updated in 10 years at a cost of $5m and again in 10 more years at a cost of $6m. a. In Excel, calculate each project's payback period and discounted payback period. b. Using Excel's financial functions, calculate each project's net present value, internal rate of return, and modified internal rate of return. You are the financial analyst for the University of South Carolina's athletic department. As part of its master facilities plan, the department's chief financial officer has asked you to analyze a capital investment, a new stadium remodel. The project cost $15,000,000, and the cost of capital is 8.75%. The project's expected to increase revenue by $1,500,000 in year one and then increase by 2% each year into year 30. The stadium will have to be updated in 10 years at a cost of $5m and again in 10 more years at a cost of $6m. a. In Excel, calculate each project's payback period and discounted payback period. b. Using Excel's financial functions, calculate each project's net present value, internal rate of return, and modified internal rate of return.
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Related Book For
Modern Systems Analysis And Design
ISBN: 9780134204925
8th Edition
Authors: Joseph Valacich, Joey George
Posted Date:
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