Business Decision Making: Canterbury Christ Church University Report
VerifiedAdded on 2023/06/05
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AI Summary
This report assesses two projects, A and B, using discounting and non-discounting techniques such as the payback period (PBP) and net present value (NPV) to determine the best investment option for S&P, a bag manufacturing company. The PBP for project A is calculated at 2 years and 8 months, while for project B it is 2 years and 7 months. The NPV for project A is $147,320, and for project B it is $143,450. The report discusses the advantages and disadvantages of each method, highlighting that PBP is useful for short-term funding decisions, while NPV considers the time value of money. It also examines financial and non-financial factors, such as weather changes, staff motivation, and government regulations, that influence investment decisions, concluding that a comprehensive evaluation of both financial metrics and external factors is crucial for effective capital assessment.
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