Investment Appraisal Techniques Required For Proposed Investment On The New Digital Photograhic Printer.

3028 words - 12 pages

Digico Plc has developed a digital photographic printer which the company believe has great potential. It is unique in that it can be adapted for any make of digital camera and will retail at an affordable price.It is expected that sales would exceed the capacity of their existing factory and the company would require to provide additional production facilities and support staff.The company will need to raise finance for the project.You are required to prepare a report to the Managing Director outlining and justifying the steps to be taken before the project finally goes ahead. Figures are not required but it is necessary to spell out in detail exactly what techniques should be used and why these techniques (and no others). The order in which the steps should be taken is also required.Your report should be of 2,500 words and be supported by academic references.Marks will be awarded as follows;Analysis and interpretation 65%Integration of academic literature 35%No. 1 New Market Road,HULLYorkshireHU2 9BQ11th December 2006Attention: Managing Director From: Financial AssistantRE: Suggested techniques required for the proposed investment on the new digital photographic printer.In reference to the meeting held on the 6th of November 2006, I have provided you with information below on the investment appraisal techniques and sources of finance that are available for the proposed investment on the new digital photographic printer. To clarify briefly on the information I received, it shows that the photographic printer inconsideration is intended to be unique, adaptable to any model of digital camera and also if accepted will be retailed at an affordable price. It has also been forecasted by the sales manager that product sales will exceed the capacity of the existing factory, therefore additional production facilities and support staff will be needed to meet the required demand. In addition the company may also need additional finance for the project.Nature of InvestmentWhen considering a business investment of large sums of money within a long term project, it is an important objective to ensure that the money received over the life of the project is higher that the initial cost of investment.In deciding on the investment to undertake time is the most essential factor, followed by the amount of cash going in and out of the business. In some cases, an investment is made not to generate more cash but to make a saving on present cost. (Tony D. and Brian P. 2002, pg 458).The lay out of investments usually involve the injection of large sums of money and returns on the investment are received in a series of small amounts over an extended period of time. In addition, because large sums of money are usually involved it can be very expensive and catastrophic to pull out. Considering the loss of production and investment that can be lost from a failed investment, it is essential that investment proposals are properly screened and examined to ensure that the...

Find Another Essay On Investment Appraisal techniques required for proposed investment on the new digital photograhic printer.

Risk Analysis on Investment Decision

1097 words - 4 pages diversifying the company. The company could market the new IC 1032 chip for five years. During the five year period, research and development can diversify new technological products to continue marketing in the industry. The risk for using the internal investment strategy is that research and development may not provide a new marketable product(s) that attract consumers. The IC 1032 chip has the risk a competitive company producing a better

Risk Analysis on Investment Decision

840 words - 3 pages they can make adjustments."The adjustments that a firm can make after a project is accepted are called real options" (Ross, Westerfield, & Jaffe, 2005, p. 43). Silicon has two options, which are to expand their digital imaging or enter into the wireless market. The wireless market is expected to boom and would require an investment for a second plant when business starts taking off. At that point then Silicon would have the option to expand or

Piracy and the Investment Cost for a starting company

1046 words - 5 pages efforts show go to find ways of enabling final users to license the software the way they want. Software developers claim to lost huge amounts of money based on every single time their software is used without a license. What is not considered is that the revenue they were losing was not necessarily revenue they would have ever had. One example is students. There is no way for students to actually afford the software, so they find alternative ways

Attracting Foreign Investment into the Netherlands: A focus on Biofuels

3566 words - 14 pages Investment in the Benelux:A Focus on BiofuelsPrepared for: Charlene Lambert, MNGT 4330 International MarketingPrepared by: Erik Sawaya, Etienne MaraisProject Date: 05.03.2008Table of ContentsSection 1: Introduction1.1 Benelux Analysis 11.2 Relevant Statistics for Investment Regions 2Section 2: Engineering 32.1 Biofuels 32.1.1 Biodiesel 32.1.2 Benets 32.1.3 Downsides 32.2 Benelux Sector 32.2.2 Royal Dutch Shell 42.2.3 BIOPETROL INDUSTRIES AG

The Bernard Madoff Investment Scandal

2674 words - 11 pages system which promised high returns in the short term and was nothing but the Ponzi scheme. The system’s idea relied on funds from the new investors to pay misrepresented and extremely high returns to existing investors. He was doing this for years; convincing wealthy individuals and charities to invest billions of dollars into his hedge fund. And they did so because of the extremely high returns, which were promised by Madoff’s firm. If anyone

Return on Investment on Renewable Energy

1065 words - 5 pages For the average person in North America, utilities bills are an ever increasing expense. Homeowners who decide to use renewable energy in the form of geothermal, wind, or solar power are seeking a way to defray the cost of utility bills. As the average cost of solar power set up or kits decrease and the popularity increases, the question becomes what is the long-term return on investment. For a better understanding of return of investment on

MBA 540 Analysis on Investment Decision for Silicon Arts, Inc. SAI

854 words - 3 pages the project. A new plant producing 1000 units per day will initiate the opportunity costs for the project's expected 1 to 3 year for a cash investment of $18 Million. An additional plant producing 3000 units per day will be set up to help in 3-7 years, resulting in$16 Million cash investment. $437,500, 3.5% of 12.5 million can be easily produced by the second plant alone running on a little over half the capacity in one year's time. In just one

Inflation and Its Effects on Investment

1447 words - 6 pages Inflation and Its Effects on Investment For world economic markets, inflation is a fairly new experience as for much of the pre-twentieth century there had been little upward pressure on prices due to gold and other metallic standards. These backed currencies limited governments’ abilities to create new money. So at the end of the gold standard strong political pressures often caused governments to issue more money increasing the money

Rationality of Financial Markets on Investment Variables

595 words - 3 pages standard orthodoxy.     The need for investment especially for a developing nation such as the Philippines can never be emphasized enough. The economics of expansion cannot be understood without the participation of the capital markets. The need for capital markets started with the need for capital to finance mercantilist expansion. The modern stock market is not different, especially in the advent of globalized trade and international markets. The

This is an essay on Norelco's shopping cart investment plans. Its was for a marketing class

642 words - 3 pages stores under the Norelco name.The director of marketing for the North American Philips Lighting Corporation (NAPLC) was John Hays. John Hayes worked for the Westinghouse Electric Company for 12 before taking this project on in 1978. Everyone from the marketing department to upper managers thought the program was going to be a huge success in introducing the Norelco light bulbs to the grocery store area. When the shopping cart project was started

Discuss these titles about the ASX: risk and return, aims of investment, considerations for setting up a portfolio, shares & alternative investment. Make reference to the profiles!

1739 words - 7 pages accumulate immense wealth in years to come. Cathy is by fair in the best position due to her profile of being young, reasonably affluent and at this time has minimal liabilities. Fred would be selecting a strategy for investment that would be looking to the future. Fred has the greatest ingredient for affluence on his side and that is plenty of time. Fred's strategy should incorporate the costs education for his children and retirement. Jim and Joan's

Similar Essays

Finacial Management Investment Appraisal And Finance Of "New Printer" Project

2146 words - 9 pages IntroductionWheybridge Ltd has developed a new product- the printer, which has great potential, can be sold to all computer users. However, the sales would exceed the existing capacity. Wheybridge has to develop its own delivery, recruit staff and purchase vehicles. Therefore it is necessary to budget the investment amount and analyze available finance sources to invest this project. Moreover, with the aid of investment appraisal, managers

The Theoretical Rationale For The Npv Approach To Investment Appraisal

1385 words - 6 pages Explain the theoretical rationale for the NPV approach to investment appraisal and compare the strengths and weaknesses of the NPV approach to two other commonly used approaches. One of the key areas of long-term decision-making that firms must tackle is that of investment - the need to commit funds by purchasing land, buildings, machinery, etc., in anticipation of being able to earn an income greater than the funds committed. In order to

Security For Information Technology: Return On Investment

620 words - 2 pages Investment".Return on Security Investment (ROSI)Return on Security Investment (ROSI), being the very new approach to security investment, is a deliberate attempt to wrap accurate figures around the spending, and allow it to be judged under the same accounting ROI measurement as most other investments a company may make.The point of maximum return on security investment is where the total cost of security is lowest -- including both the cost of security

Return On Investment Analysis

1233 words - 5 pages of return on investment from a training and staff development perspective and why it is important. To Train or Not To Train Companies and educational institutions at one time or another will face the question of whether training will help their company remain competitive. Training is very expensive and time consuming. The employee will miss time from work. Someone will have to fill in for the employee. The "fill-in" may not perform as