Milestone Three: Capital Budgeting Data (Section IV)

Instructions

For this milestone, submit a draft of the Capital Budgeting Data section of the final project, along with your supporting explanations. Base your calculations on the data provided in this case study. Be sure to substantiate your claims.

Submit your calculations on the designated tab of the Final Project Student Workbook and your supporting explanations as a Microsoft Word document.

Specifically, the following critical elements must be addressed:

IV. Capital Budgeting Data

A. Suppose the company is considering a potential investment project to add to its portfolio. Calculate the following items:

1. The net present value (NPV) of the project

2. The internal rate of return (IRR) of the project

B. What are the implications of these calculations? In other words, based on each of the calculations, and being mindful of the need to balance portfolio risk with return, would you recommend that the company pursue the investment? Why or why not? Be sure to substantiate your

claims.

C. What is the difference between NPV and IRR? Which one would you choose for evaluating a potential investment and why? Be sure to support your reasoning with evidence.

The paper must be submitted as a 2- to 3-page Microsoft Word document, not including the calculations.

I also upload the 2-2 revised final (milestone 1) and 4-1 final (milestone 2), the workbook excel including the calculations as references. Please check them.