Describe net present valueas it pertains the new cafe

Reference no: EM131399036

Using the information in the assignment description:

• Prepare a capital budget for the Hot New Cafe with the net cash flows for this project over a 5-year period.
• Calculate the payback period (P/B) and the net present value (NPV) for the project.
• Answer the following questions based on your P/B and NPV calculations:

o Do you think the project should be accepted? Why?

o Define and describe Net Present Value (NPV) as it pertains to the new cafe.

o Define payback period. Assume the company has a P/B (payback) policy of not accepting projects with life of over 3 years. Do you think the project should be accepted? Why?

Reference no: EM131399036

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