Additional financial analyses

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Your company is considering three mutually exclusive projects. Project A will expand the existing business operations in the current location. Project B will expand the existing business operations to the adjacent county. Project C will expand into a new business operation that is not related to current business operations. Surprisingly, the projected financial cash flows and the analysis of these two projects yield exactly identical results:

Project A

Project B

Project C

NPV @ 15%

$12,100

$12,100

$12,100

IRR

25%

25%

25%

Payback

2.7 yrs

2.7 yrs

2.7 yrs

How should your company determine which project to select? Are there non-financial considerations that should be taken into account? Are there additional financial analyses that should be performed?

 

Reference no: EM1358620

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