Homework: Financial Management
Details
Deal or No Deal?
Your neighborhood self-service laundry is for sale and you consider investing in this business. For the business alone and no other assets (such as building and land), the purchase price is $240,000. The net cash flows for the project are $30,000 per year for the next 5 years. You plan to borrow the money for this investment at 5%.
• Prepare a net present value calculation for this project. What is the net present value of this project?
• Calculate the simple payback period for this project. Your desired payback period is 5 years. How long is the payback period for this project?
• Is this a good investment? What would be a good price at which to purchase this business?
Format your homework according to the following formatting requirements:
i) The answer should be typed, using Times New Roman font (size 12), double spaced, with one-inch margins on all sides.
ii) The response also includes a cover page containing the title of the homework, the student's name, the course title, and the date. The cover page is not included in the required page length.
iii) Also include a reference page. The Citations and references must follow APA format. The reference page is not included in the required page length.