User Account

All Pages

NPV, Project Management

Assignment Help:


A brilliant UTM student at the end of his graduation is in presence of two opportunities and has to choose between them. One is a job offer with a salary of Rs15,000 per month (with no other benefits except for one month end of year bonus). It is expected that the monthly salary will increase on average by 10% every year for the first 5 years of his career. His personal costs amount to Rs5,000 per month and is expected to increase by 5% every year for the next 5 years. The next opportunity is the possibility of creating his own call centre which promises the following benefits: a steady revenue stream of Rs100,000 per month with an increase of 30% every year.

Operational costs for the call centre are about Rs65,000 per month and will increase by 10% each year for the first 5 years. It is assumed that an investment of Rs500,000 will be required in the second case which will be granted as an interest free loan by the Government with annual repayments of Rs100,000 over the next 5 years.

(a) Summarise the net cash flows for each opportunity for a period of 5 years. For simplification purposes, ignore the effect of taxes (both corporate and income tax).

(b) Calculate the Net Present Value for each opportunity. Use 10% as discount rate.

(c) Which opportunity is better from the financial point of view?

Related Discussions:- NPV

Implementation of a quality program, Question: (a) Any project has a be...

Question: (a) Any project has a beginning and an end; without a formal closure process, project teams can fail to recognize the end and this can drag the project into unnecessa

What are the costs involved with respect to quality, Question 1: Descri...

Question 1: Describe Total Quality Management. What are the Costs involved with respect to ‘Quality'? Cost of Quality Meaning of TQM Quality Control Costs

Microsoft Project Management, Greeting, Do you use Microsoft Project Manage...

Greeting, Do you use Microsoft Project Management software for project management assignments if needed

Conflicts arise between project manager and ppso staff, What are conflicts ...

What are conflicts probable to arise between project managers and PPSO staff? PPSO (Project and Programme support office) staff can, when they are not careful or when they are

Explain about the term management in brief, Explain about the term manageme...

Explain about the term management in brief. Management in words of LAWRENCE APPLEY: “Management is the accomplishment of outcomes by the efforts of many other people”.

LIne balancing, Q3. What do you understand by “line balancing”? What happen...

Q3. What do you understand by “line balancing”? What happens if balance doesn’t exist?

Important role that the corporate level strategy, Strategy is developed at ...

Strategy is developed at different levels in large organisations. The process starts with the corporate strategy which is then translated into the strategy for the business divisio

What are the primary objectives of transferring risks, Question : (a) ...

Question : (a) Define risk as per the Public Private Partnership Guidance Manual. (b) What are the primary objectives of transferring risks from a contracting authority to

Describe the roles of the sponsor, Describe the roles of the sponsor. T...

Describe the roles of the sponsor. The sponsor’s role is to signify the organisation commissioning the project and to create the main business decisions relating this. The spon

"simultaneous loose?tight" by Peters, Discuss the concept of "simultaneous ...

Discuss the concept of "simultaneous loose?tight" by Peters and Waterman

Write Your Message!

Captcha
Order Assignment

Featured Services

Order Now

Popular Subjects

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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