Organisational Finance

1. What types of investment projects would you expect to find in a minerals company?
2. You will be working in the CFO’s office if you obtain this job. What activities do you expect are undertaken in this office?
3. AMR is a public company, listed on the stock exchange. How does this fact have a bearing on the goal we should bear in mind when managing our finances?
4. Does or should AMR have any other accountabilities apart from responsibilities to the firm’s owners?
(i) If RWE uses a 10% discount rate to evaluate investment of this type, what is the net present value of the project?
 (ii) What does this NPV indicate about the potential value RWE might create by purchasing the new production line?
(c) Calculate the payback and discounted payback for the proposed investment. Interpret your findings


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