Internal rates of return , Basic Statistics

Assignment Help:

A consumer product firm finds that its brand of laundry detergent is losing market share, so it decides that it needs to "freshen" the product. One strategy is to maintain the current detergent formula but to repackage the product. The other strategy involves a complete reformulation of the product in a way that will appeal to environmentally conscious consumers. The firm will pursue one strategy or the other but not both. Cash flows from each proposal appear below, and the firm discounts cash flows at 13%.

Year

Repackage

Reformulate

0

- $3,000,000

- $25,000,000

1

2,000,0000

10,000,000

2

1,250,000

9,000,000

3

500,000

7,000,000

4

250,000

4,000,000

5

250,000

3,500,000

 

(a)   What strategy will you plan to take an appropriate decision?

(b)   Rank these investments based on their pay back periods.

(c)    Rank these investments based on their net present values (NPVs).

(d)   Rank these investments based on their internal rates of return (IRR).

(e)   Do these investment rankings yield mixed signals?


Related Discussions:- Internal rates of return

Compute the data using both Megastats and Excel Data, AA major razor blade ...

AA major razor blade manufacturer advertises that its twin-blade disposable razor “gets you lots more shaves” than any single-blade disposable razor on the market. A rival company

Report on the residual plots, Report on the residual plots – are the assump...

Report on the residual plots – are the assumptions of the regression met

Median graph(less than), Marks(less than)-10,20,30,40,50,60,70,80 Number of...

Marks(less than)-10,20,30,40,50,60,70,80 Number of students-4,8,25,34,41,46,50,60 Draw a median graph for the followin

Best subsets” method to identify a “best” model for the data, Use the “best...

Use the “best subsets” method to identify a “best” model for the data. Explain what you think is the best model and why.

accounting, Fenn Museum, a nongovernmental not-for-profit organization, ha...

Fenn Museum, a nongovernmental not-for-profit organization, had the following balances in its statement of functional expenses: Education $300,000 Fundraising 250,000 Management an

Cost accounting, what is the relationship of cost accounting to financial a...

what is the relationship of cost accounting to financial and management accounting?

Spatial ability test and musical ability test, This question has multiple p...

This question has multiple parts. Use the following information to answer the questions below: Spatial Ability Test Musical Ability Test Mean 80 74 Standard Deviation 6

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd