I already have the excel with the correct data, so just analysis that.
Task 1 Calculations (using the spreadsheet)
a) Enter relevant figures into the cash flows worksheet and justify any adjustments to the profit and loss accounts as a result of the information in points a)-j) above.
b) Using the figures in the calculations worksheet for Net present value (NPV), Internal Rate of Return (IRR), accounting rate of return (ARR) and Payback Period, state, with reasons which project you would accept.
c) Use the sensitivity worksheet to prepare a sensitivity analysis for each project by adjusting each variable +/- 10%.
The spreadsheet provided will enable you to undertake all necessary calculations. You must use this spreadsheet.
(40 marks)
Task 2 Risk
You are not expected to do any calculations for this task.
• Evaluate these projects using your sensitivity analysis.
• Discuss how using expected values could help analyse the projects.
• Discuss how UK Gold Mining Ltd. could take account of inflation in their analysis.
Credit will be given in this task for appropriate use of academic literature along with accurate citations and referencing using the Harvard system.
(60 marks)
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