question archive Your executive leadership team has given you a potential project to analyze and provided questions they would like you to answer
Your executive leadership team has given you a potential project to analyze and provided questions they would like you to answer
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Your executive leadership team has given you a potential project to analyze and provided questions they would like you to answer. Using the project details below, write a one-page Executive Summary of your project analysis and provide the team with a final recommendation for whether your company should pursue the project.
Project Details: The project will require an initial investment of $300,000 and is expected to return the following cash flows:
| Year | Amount |
| 1 | $25,000 |
| 2 | $50,000 |
| 3 | $35,000 |
| 4 | $120,000 |
| 5 | $130,000 |
| 6 | -$25,000 |
| 7 | $110,000 |
Leadership Questions: Address the following questions from the leadership team in your Executive Summary. Be sure to include clear rationales for each of your responses.
- Assuming we discount inflation, what is the IRR of this project over a seven-year span?
- Given the calculated IRR, and assuming we can earn 7% by investing in securities, would you recommend that we pursue the project? Why or why not?
