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Business and Management Archives - Cloud Essays

Business and Management

Business and Management

  • Defining Yourself As a Leader

    $12.00

    Assessment 2

    Defining Yourself As a Leader

    Prepare a 2–3-page business report (single spaced) in which you analyze your leadership strengths and develop a statement of who you are as a leader.

    Your leader is interested in your development as a leader in your organization. You have recently taken a variety of self-assessments designed to better understand your strengths, areas of improvement, communication ability, and values. Your leader would like you to spend some time reflecting on the results of your assessments and setting SMART goals for future improvement, gathering some additional information from those who know you best.

    Your role is to prepare a report in which you review and reflect on your strengths. To do this, collect information from the various assessments in class or from colleagues, friends, or others who know you well, and create a portrait of yourself as a leader. Then, reflect on how this information fits with your own view of yourself and your behavior on the job or in life by creating a personal SWOT and some SMART goals.

    For this paper:

    • Discuss the strengths, skills, and other positives that were revealed in the assessments that you took. Do these strengths surprise you or reinforce what you already thought? How do you use these strengths currently? Be sure to clearly explain which assessment gave you the information and cite the assessments in APA format.
    • If you choose to, discuss your strengths further by summarizing what the people that you asked about you responded, and relating how what you learned from the people you talked to and the assessments fits in with what you already knew about yourself, and with the work you currently do or hope to do in the future.
    • Bring together all data points—your own feelings about your skills, what the assessments revealed, what your contacts said about you—in a cohesive personal SWOT.
    • Describe one or two areas that you learned are growth opportunities (where you did not perform so strongly). How did you feel about this? What specific and actionable steps might you take to strengthen these areas? List at least one SMART goal that you can set for yourself.
    • Develop a statement of who you are as a leader, based on your analysis. This statement should include your values, strengths, goals, and more. You should include in your statement who you want to be as a leader—what you aspire to become. This way, your statement becomes your own vision of who you want to be and an affirmation to help you grow.

    Your deliverable is a 2–3-page business report (single spaced). Business reports are formatted differently from academic, APA formatting. For information about the differences, refer to MBA Program Resources. You will want to review the MBA Academic and Professional Document Guidelines. Note that this business report MUST be single-spaced, professionally formatted, and organized with ample headings. Because this is a personal reflection, you may write it in first person.

     

    Collecting Feedback From People:

    If you choose, you can collect valuable feedback about your strengths through others. Because not everyone is likely to respond, you should identify at least 6–10 people to ask. Choose a variety of people who have had extended contact with you, such as:

    • Colleagues (former or current), such as vendors, customers, or board members.
    • Friends (old or recent), neighbors, or fellow volunteers.
    • Family members.
    • Others who know you well. Be creative in your choices.

    Try to give your respondents sufficient time to respond. You can create a feedback form or keep it simpler.

    The questions you should ask are:

    • Who am I when I am at my best?
    • Can you provide a specific example of a time when I was at my best?

    The Defining Yourself As a Leader business report is a professional document and should therefore follow the corresponding MBA Academic and Professional Document Guidelines, including single-spaced paragraphs. In addition to the report, include:

    • Title page or a heading at the top of the first page with title, date, and your name.
    • Introduction.
    • Various sections (see recommended outline below).
    • Conclusion.
    • References page.
    • APA-formatted references (if applicable).

    You might consider using the following outline:

    • Introduction (Tell the reader what this paper is about. Do not assume that the reader knows what the assessment is).
    • My Strengths (Detail which assessments you took, what strengths and values were revealed, and comments you received, if applicable).
    • Personal SWOT Leadership Statement (Provide a brief personal SWOT in bullet form or a four-square graphic. Create a statement of who you want to be as a leader—make it aspiring, like an affirmation).
    • Growth Opportunities (Briefly overview the importance of growing and setting goals. Then, develop at least two SMART goals based on your analysis. Detail the areas where you have yet to grow and discuss some plans for achieving that growth).
    • Conclusion (wrap up the paper effectively).
    • References (in APA format. Be sure to cite the assessments that you took, and any readings that are applicable).

    By successfully completing this assessment, you will demonstrate your proficiency in the following course competencies through corresponding scoring guide criteria:

    • Competency 1: Analyze the strengths and behaviors of successful leaders.
      • Analyze personal leadership strengths.
      • Develop a personal SWOT leadership statement that includes purpose and values as a leader.
    • Competency 2: Apply leadership strengths and behaviors to workplace situations.
      • Describe how you use your strengths in the workplace or plan to in the future and how you will develop your weaknesses to become strengths by setting SMART goals.
    • Competency 4: Communicate effectively through academic and professional writing.
      • Develop text using organization, structure, and transitions that demonstrate understanding of the relationship between the main topic and subtopics.
      • Convey clear meaning in text through sound grammar, usage, word choice, and mechanics.

     

  • Create a Statement of Organizational or Personal Capacity

    $7.00

    Week 4 – Assignment 2: Create a Statement of Organizational or Personal Capacity

    Top of Form

    Hide Folder Information
    Instructions
    This week, write a brief statement of organizational or personal capacity. Your statement of capacity should correspond with the requirements identified in the CHE Application Information Guide Stage II (pp. 3-4). Please note the character limit for the Application’s Qualifications is up to 2,400 characters or 350 words.

    Provide a brief overview of your personal or the organization’s capacity to undertake the work. Explain what, if any, experience you and/or your organization have had concerning the type of work for which you seek support. Be sure to indicate who will be responsible for the work and what expertise they bring to the project. Then, reveal whether other organizations in your community, region, or nation are doing similar work and if they are, explain if you have sought information from them or will work with them in any way.

    Support your assignment with at least three scholarly resources. In addition to these specified resources, other appropriate scholarly resources, including older articles, may be included.

    Length: as required by the CHE guidelines

    Your assignment should reflect scholarly writing and current APA standards where appropriate.

  • RNM1 — RNM1 TASK 1: MANAGING A PROJECT

    $7.00

     

    RNM1 — RNM1 TASK 1: MANAGING A PROJECT

    BUSINESS ENVIRONMENT APPLICATIONS II: PROCESS, LOGISTICS, AND OPERATIONS — D079

    PRFA — RNM1

    TASK OVERVIEWSUBMISSIONSEVALUATION REPORT

    COMPETENCIES

    3079.1.1 : Project Management

    The graduate explains how project management concepts can help an organization achieve its goals.

    INTRODUCTION

    Today’s business environment requires competency in project management. In this assessment, you will explain how project management concepts can help an organization achieve its goals. You will take on the role of a market owner who goes through all five phases of project management (i.e., initiation, planning, execution, control, and closure) to launch a new catering service. As you complete the assessment, think about past projects you have initiated, planned, executed, controlled, and closed. Your experience in planning past projects can help you recognize possible risks and functions that will need to be managed in this performance assessment.

    SCENARIO

    You are the owner of a local organic food market in an urban area at the crossroads of four farming communities that supply fresh, organic foods. As the owner of the market, you are interested in growing the business.

     

    Customers in the area have been asking local vendors for more organic and locally sourced fresh food options. You decide to create a catering service for clients within 25 miles of the market to celebrate the market’s 10-year anniversary. You plan to start this catering business in 30 days to address the increasing market need for organic, fresh catering. Catering orders will be prepared and packaged at the organic food market and then driven to the customer’s location. Lunch orders will be delivered within 60 minutes of receiving the order. Special event catering orders will require one week to fulfill the order. The catering company has one van that will be used exclusively for catering services.

     

    You have identified the following goals for this catering business:

     

    •  The catering business will need to be able to sell the same quality, organic foods that are sold in-store and supplied daily.
    •  The catering customers can be no farther than 25 miles from the store so that food can be delivered within an hour.
    •  The catering business should be profitable within one year.
    •  The cost of developing the catering business should not negatively impact the in-store retail operations budget, staffing, events, and farmer partnerships.

     

    You plan to launch the catering business by providing a free catered lunch to the first 10 businesses that subscribe to the weekly lunch catering services. The catered lunch for each business will be for up to 30 people and will be held at a local conference center ballroom at noon on a day of the customer’s choosing. The budget for this launch of 10 catered lunches is $7,000.

     

    Two weeks before the launch, you are working with catering staff to calculate the costs of the launch to date, review tasks that need to be completed, and assess the overall impact of catering on in-store retail operations. You learn that the costs associated with the launch of the free catered lunches have already exceeded $7,700. Additionally, a local farmer that provides the fresh lettuce for lunch salads notifies you that the lettuce will not be available in time for the catered lunch. No other local farmers have lettuce available for purchase, and the only option is to use nonorganic lettuce in order to keep the menu as communicated to the 10 businesses subscribing to the weekly lunch catering services.

     

    A financial company representative wants to inquire about possibly financing your company for this project. The representative sends a request for information to you as listed in the requirements for this task.

    REQUIREMENTS

    Your submission must be your original work. No more than a combined total of 30% of the submission and no more than a 10% match to any one individual source can be directly quoted or closely paraphrased from sources, even if cited correctly. The similarity report that is provided when you submit your task can be used as a guide.

     

    You must use the rubric to direct the creation of your submission because it provides detailed criteria that will be used to evaluate your work. Each requirement below may be evaluated by more than one rubric aspect. The rubric aspect titles may contain hyperlinks to relevant portions of the course.

     

    Tasks may not be submitted as cloud links, such as links to Google Docs, Google Slides, OneDrive, etc., unless specified in the task requirements. All other submissions must be file types that are uploaded and submitted as attachments (e.g., .docx, .pdf, .ppt).

     

    1. Discuss how you would plan the catered lunch project by completing eachof the following 5 distinct project management phases:
    2. Project initiation
    3. Describe the project and the need for the project. Include information from the provided scenario for support.
    4. Identify threerelevant stakeholders and discuss how the project impacts each stakeholder.
    5. Discuss whether the project is feasible by addressing eachof the three triple constraint components: scope, cost, and timeline.
    6. Project planning
    7. List threemilestones for the project plan and provide a timeline for each milestone.
    8. Write a SMART goal for the project.
    9. Identify twodifferent potential risks to this project’s success and describe how each risk could be managed.
    10. Project execution
    11. Discuss a way to address being over budget by 10 percent. Include information from the provided scenario for support.
    12. Discuss a way to address a scheduling conflict that could affect the timeline of the project. Include information from the provided scenario for support.
    13. Project monitoring and control
    14. Discuss how scheduling conflicts and budget constraints could affect the scope of the project. Include information from the provided scenario for support.
    15. Project closure
    16. Discuss twoways to change how the project was planned, considering the timeline and budget conflicts that were encountered.
    17. Acknowledge sources, using in-text citations and references, for content that is quoted, paraphrased, or summarized.
    18. Demonstrate professional communication in the content and presentation of your submission.

    File Restrictions

    File name may contain only letters, numbers, spaces, and these symbols: ! – _ . * ‘ ( )
    File size limit: 200 MB
    File types allowed: doc, docx, rtf, xls, xlsx, ppt, pptx, odt, pdf, txt, qt, mov, mpg, avi, mp3, wav, mp4, wma, flv, asf, mpeg, wmv, m4v, svg, tif, tiff, jpeg, jpg, gif, png, zip, rar, tar, 7z

    RUBRIC

    A1A:PROJECT DESCRIPTION AND NEED

    NOT EVIDENT

    The submission does not describe the project and the need for the project.

    APPROACHING COMPETENCE

    The submission describes the project but the need for the project is not described, or the submission does not integrate information from the provided scenario for support.

    COMPETENT

    The submission describes the project and the need for the project and integrates information from the provided scenario for support.

    A1B:STAKEHOLDERS

    NOT EVIDENT

    The submission does not identify 3 stakeholders and discuss how the project impacts each stakeholder.

    APPROACHING COMPETENCE

    The submission does not identify 3 stakeholders relevant to the project. Or the submission does not clearly discuss how the project impacts each identified stakeholder.

    COMPETENT

    The submission identifies 3 stakeholders relevant to the project and clearly discusses how the project impacts each identified stakeholder.

    A1C:PROJECT FEASIBILITY

    NOT EVIDENT

    The submission does not discuss the project’s feasibility by addressing any of the 3 triple constraint components.

    APPROACHING COMPETENCE

    The submission discusses the project’s feasibility, but the discussion does not address 1 or more triple constraint components, or the discussion is inconsistent with the scenario.

    COMPETENT

    The submission discusses the project’s feasibility by addressing each of the 3 triple constraint components, and the discussion is consistent with the scenario.

    A2A:MILESTONES AND TIMELINES

    NOT EVIDENT

    The submission does not list 3 milestones or provide any timelines.

    APPROACHING COMPETENCE

    The submission lists 3 milestones but is missing a timeline for 1 or more milestones. Or any provided component is not plausible for the project.

    COMPETENT

    The submission lists 3 milestones and a timeline for each milestone, and all provided components are plausible for the project.

    A2B:SMART GOAL

    NOT EVIDENT

    A goal for the project is not provided.

    APPROACHING COMPETENCE

    The goal for the project does not include all 5 SMART aspects (i.e., specific, measurable, achievable, realistic, and time-bound).

    COMPETENT

    The goal for the project includes all 5 SMART aspects (i.e., specific, measurable, achievable, realistic, and time-bound).

    A2C:RISKS

    NOT EVIDENT

    The submission does not identify any potential risks or describe how risks could be managed.

    APPROACHING COMPETENCE

    The submission identifies only 1 potential risk, or it identifies 2 potential risks that are not different. Or 1 or both risks are not plausible or relevant to the project. Or the description of how each identified risk could be managed is missing or not plausible.

    COMPETENT

    The submission identifies 2 different potential risks and describes how each risk could be managed. The identified risks are plausible and relevant to the project.

    A3A:BUDGET

    NOT EVIDENT

    The submission does not discuss a way to address the project budget being over by 10 percent.

    APPROACHING COMPETENCE

    The submission discusses a way to address the project budget being over by 10 percent, but it is not plausible, or it does not integrate information from the provided scenario for support.

    COMPETENT

    The submission discusses a way to address the project budget being over by 10 percent, it is plausible, and it integrates information from the provided scenario for support.

    A3B:SCHEDULING

    NOT EVIDENT

    The submission does not discuss a way to address a scheduling conflict for the project.

    APPROACHING COMPETENCE

    The submission discusses a way to address a scheduling conflict for the project, but the discussion is not plausible, or it does not integrate information from the provided scenario for support.

    COMPETENT

    The submission discusses a way to address a scheduling conflict for the project. The discussion is plausible, and it integrates information from the provided scenario for support.

    A4A:SCHEDULING CONFLICTS AND BUDGET CONSTRAINTS

    NOT EVIDENT

    The submission does not discuss how scheduling conflicts or budget constraints could affect the scope of the project.

    APPROACHING COMPETENCE

    The submission is missing discussion of scheduling conflicts or budget constraints that could affect the scope of the project, or it is not plausible, or it does not integrate information from the provided scenario for support.

    COMPETENT

    The submission discusses how scheduling conflicts and budget constraints could affect the scope of the project. The discussion is plausible, and it integrates information from the provided scenario for support.

    A5A:CHANGES TO PROJECT PLAN

    NOT EVIDENT

    The submission does not discuss 2 ways to change how the project was planned.

    APPROACHING COMPETENCE

    The submission discusses 2 ways to change how the project was planned, but the discussion does not address the timeline or budget conflicts encountered, or the discussed changes are not plausible.

    COMPETENT

    The submission discusses 2 ways to change how the project was planned, and the discussion addresses the timeline and budget conflicts encountered. The discussed changes are plausible.

    B:SOURCES

    NOT EVIDENT

    The submission does not include both in-text citations and a reference list for sources that are quoted, paraphrased, or summarized.

    APPROACHING COMPETENCE

    The submission includes in-text citations for sources that are quoted, paraphrased, or summarized and a reference list; however, the citations or reference list is incomplete or inaccurate.

    COMPETENT

    The submission includes in-text citations for sources that are properly quoted, paraphrased, or summarized and a reference list that accurately identifies the author, date, title, and source location as available.

    C:PROFESSIONAL COMMUNICATION

    NOT EVIDENT

    Content is unstructured, is disjointed, or contains pervasive errors in mechanics, usage, or grammar. Vocabulary or tone is unprofessional or distracts from the topic.

    APPROACHING COMPETENCE

    Content is poorly organized, is difficult to follow, or contains errors in mechanics, usage, or grammar that cause confusion. Terminology is misused or ineffective.

    COMPETENT

    Content reflects attention to detail, is organized, and focuses on the main ideas as prescribed in the task or chosen by the candidate. Terminology is pertinent, is used correctly, and effectively conveys the intended meaning. Mechanics, usage, and grammar promote accurate interpretation and understanding.

     

  • Foundation, Government, and Research Grants

    $20.00

    For this week’s assignment, create a voice-over PowerPoint presentation that explains the following information for five to seven foundations grantors and five to seven government grantors. Assume you are presenting to key decision makers for a foundation, government, or research granting agency.

     

    Include the following in your presentation:

    • Name each foundation, government, or research entity.
    • Provide the mission statement of the foundation, government, or research entity.
    • Examine the details of each entity (length of time in existence, the total amount of funds granted, and/or a total number of programs funded).
    • If available, provide a list of programs funded by the foundation, government, or research entity over the last three years.
    • Explain the process of application (e.g., letter of inquiry, full proposal, letter of interest, letter of intent to apply).

    Incorporate appropriate animations, transitions, and graphics as well as speaker notes for each slide. The speaker notes may be comprised of brief paragraphs or bulleted lists and should cite material appropriately. Add audio to each slide using the Media section of the Insert tab in the top menu bar for each slide.

    Be sure to reference your selected foundations and government grantors. You may include other resources, but it is not required.

    Length: 12-15 slides (with a separate reference slide)
    Notes Length: 200-350 words for each slide

    Be sure to include citations for quotations and paraphrases with references in APA format and style where appropriate.

  • Select a Possible Method and Design

    $5.00

    Create a brief summary of the research method, and then design your plan to use to investigate your research topic.

    Select a method and design appropriate for a PhD study. PhD quantitative studies must demonstrate both internal and external validity (e.g., large, random samples, statistical power and representativeness). Qualitative studies must demonstrate validity within the context of the specific qualitative design (e.g., credibility, dependability, transferability, trustworthiness). Replication studies are not permitted. Your summary must address the following:

    Note a specific method and design you plan to use in your research.
    Describe and substantiate the appropriateness of the method and design to respond to the stated problem, purpose, and research questions.
    Note how the proposed method and design accomplish the study goals, why the design is the optimum choice for the proposed research, and how the method aligns with the purpose and research questions.
    Provide appropriate foundational research method support for the proposed study design.
    Explain the particular data gathering techniques and data analyses processes. Sample size of the study population should be identified and must be appropriate and justified based on the nature of the study design. Quantitative analyses must include justified sample size determination.
    Length: 2-3 pages, not including title and reference pages

    Your assignment should demonstrate thoughtful consideration of the ideas and concepts presented in the course by providing new thoughts and insights relating directly to this topic. Your response should reflect scholarly writing and current APA standards

  • Change Management Consultation Solution

    $50.00

    Task 1: Change Management Consultation

    You have been hired as a change management consultant for a manufacturing company. The leadership of the company currently uses a top-down management approach. The organizational structure is a hierarchy (pyramid type). Employees are not encouraged to be creative or make suggestions or decisions. They are also not encouraged to experiment and come up with new solutions to problems.

    The company has grown rapidly over the past decade, from generating $1 million in sales to $100 million. In the past year, the company expanded its business internationally and now has 500 employees worldwide. Due to the rapid growth of the company, the organization has not invested in training and development opportunities for its employees to drive innovation and process improvements. Additionally, the company’s processes and software systems for inventory management have become antiquated.

    As the change management consultant, you will provide a report for the executive leadership team where you diagnose the need for change and explain how to plan for change, how to implement change, and how to sustain change. You will also explain how the company can transition to a learning organization in order to be on the forefront of change and innovation.

    Requirements
    A. Discuss the need for change for the company in the scenario using either the systems contingency model or the organizational life cycle model.

    B. Describe the differences between a learning organization and a traditional organization.
    1. Identify which stage of Woolner’s 5-stage model the company is currently in.
    a. Explain why the company is currently in the identified stage of Woolner’s 5-stage model.
    2. Explain how the company from the scenario would use Senge’s 5 disciplines to become a learning organization.

    C. Identify the end result and the nature of change to take the company from a traditional organization to a learning organization using Balogun and Hope-Hailey’s model.

    Note: You may either identify both the end result and nature of change individually or identify the name of the quadrant in Balogun and Hope-Hailey’s model that aligns to the end result and nature of change.

    1. Explain why the end result and nature of change would be appropriate for the company in the scenario using Balogun and Hope-Hailey’s model.

    D. Discuss how four steps of the action research model could be applied to the change process (traditional organization to learning organization) for the company in the scenario.

    E. Recommend two innovation strategies that management could use to transition the company in the scenario from a traditional organization to a learning organization.
    1. Explain how one recommended innovation strategy would be used by management in the company’s change process.

    F. Discuss how four steps of Kotter’s 8-step model could be applied to the change process for the company in the scenario.

    G. Explain how each of the five pillars of sustainable change could be applied to sustain the learning organization environment of the company in the scenario.

  • 50% retained earnings and 50% bonds a good approach

    $5.00
    1. Imagine you are the manager of operations for a manufacturing company. Your vice president wants to expand production by building a new facility, and she would like you to develop a business case for the project. Assume that your company’s weighted average cost of capital is 13%, the after-tax cost of debt is 7%, preferred stock is 10.5%, and common equity is 15%. As you work on the business case, you surmise that this is a fairly risky project because of a recent slowing in product sales. In fact, when using the 13% weighted average cost of capital, you discover that the project is estimated to return about 10%, which is quite a bit less than the company’s weighted average cost of capital. Your vice president suggests that the project could be financed from a mix of retained earnings (50%) and bonds (50%). She reasons that retained earnings do not cost the company anything because it is cash you already have and the after-tax cost of debt is only 7%. That would lower your weighted average cost of capital to 3.5% and make your 10% projected return look great
    2. Is your vice president’s suggestion to use a mix of 50% retained earnings and 50% bonds a good approach for this expansion? Explain why or why not. (1 paragraph)
  • WMBA 6070 SF004 part 1

    $15.00
    1. Time Value of Money: Review the examples of Time Value of Money (TVM) problems in Chapter 5 of the text. (Fundamentals of Financial Management, 13th Edition)
    • Using your own industry as the context, create and solve four of your own original TVM problems: (1) lump-sum present value, (2) lump-sum future value, (3) present value of an annuity, and (4) future value of an annuity. Your scenarios may be fictitious, but they should make sense in the real-life context of your industry.
    • Write a 1-paragraph summary for each of your scenarios that explains the “real-life” context of these four problems as well your interpretations of each of the calculations. (4 paragraphs total)
    1. Bond Valuation: Do problem 7-6, Part a, on page 251. (Fundamentals of Financial Management, 13th Edition)

     

    1. Bond Pricing Interpretation: Explain what you see from the pricing calculations. How do the two bonds differ? (1 paragraph)
    2. Yield-to-Maturity and Yield-to-Call: Do problem 7-19, Parts a-c, on pages 252–53. (Fundamentals of Financial Management, 13th Edition)
    3. Constant Growth and Non-constant Growth Valuation: Do problems 9-2 and 9-4, Parts a–c, on page 324. (Fundamentals of Financial Management, 13th Edition)
  • Chapter 6 Solutions

    $15.00

    PROBLEM 11-1

    NPV Project K costs $52,125, its expected cash inflows are $12,000 per year for 8 years, and its WACC is 12%. What is the project’s NPV?

    PROBLEM 11-2

    IRR Refer to Problem 11-1. What is the project’s IRR?

    CF0 = -52,125

    CF1-8 = 12,000

     

    PROBLEM 11-3

    MIRR Refer to Problem 11-1. What is the project’s MIRR?

    PV Cost  = 52,125

    n = 8 years

    i = 12%

    PMT = 12000

    PROBLEM 11-4

    PAYBACK PERIOD Refer to Problem 11-1. What is the project’s payback?

    Year CF Cumulative     CF

    PROBLEM 11-5

    DISCOUNTED PAYBACK Refer to Problem 11-1. What is the project’s discounted payback?

    PROBLEM 11-6

    NPV Your division is considering two projects with the following cash flows (in millions):

    Project A          ProjectB

    Year 0                           -25                            -20

    Year 1                                       5                      10

    Year 2                           10               9

    Year 3                                        17                  6

    PROBLEM 11-7

    CAPITAL BUDGETING CRITERIA A firm with a 14% WACC is evaluating two projects for this year’s capital budget. After-tax cash flows, including depreciation, are as follows:

    Project A          ProjectB

    Year 0                            -6000                    -18000

    Year 1                               2000                       5600

    Year2                            2000                   5600

    Year 3                            2000                   5600

    Year 4                           2000                   5600

    Year 5                            2000                   5600

    Problem11-8

    CAPITAL BUDGETING CRITERIA: ETHICAL CONSIDERATIONS A mining company is con-sidering a new project. Because the mine has received a permit, the project would be legal; but it would cause significant harm to a nearby river. The firm could spend an additional $10 million at Year 0 to mitigate the environmental problem, but it would not be required to do so. Developing the mine (without mitigation) would cost $60 million, and the expected cash inflows would be $20 million per year for 5 years. If the firm does invest in mitigation, the annual inflows would be $21 million. The risk-adjusted WACC is 12%.

    PROBLEM 11-9

    CAPITAL BUDGETING CRITERIA: ETHICAL CONSIDERATIONS An electric utility is consid-ering a new power plant in northern Arizona. Power from the plant would be sold in the Phoenix area, where it is badly needed. Because the firm has received a permit, the plant would be legal; but it would cause some air pollution. The company could spend an additional $40 million at Year 0 to mitigate the environmental problem, but it would not be required to do so. The plant without mitigation would cost $240 million, and the expected cash inflows would be $80 million per year for 5 years. If the firm does invest in mitigation, the annual inflows would be $84 million. Unemployment in the area where the plant would be built is high, and the plant would provide about 350 good jobs. The risk-adjusted WACC is 17%.

    Problem 11-10

    CAPITAL BUDGETING CRITERIA: MUTUALLY EXCLUSIVE PROJECTS A firm with a WACC of 10% is considering the following mutually exclusive projects:

    Years            ProjectA         ProjectB

    0                       -$400                 -$600

    1                        $55                     $300

    2                        $55                     $300

    3                        $55                     $50

    4                        $225                   $50

    5                        $225                   $49

    Which project would you recommend? Explain.