Euro Foods

Case #23 Euroland Food Synopsis and Objectives In January 2001, the senior management perpetration of this company has to decide which major projects should be funded for implementation by the company starting in 2001. The board of directors has arbitrarily case-hardened a limit of (euros) EUR120 million to be spent on groovy projects in 2001. Various managers, however, have proposed projects totaling EUR316 million. The task is to mensurate the completed discounted cash flow (DCF) analyses which the case presents, along with soft factors ( of importly strategic considerations and inhering politics of the company), and to choose the projects to be approved. The main objectives of this case are (in descending order): To explore the problem of preference allocation within corporations. To illustrate and assess the impact of capital rationing on capital investment determinations. The results usually proclaim selection of economically suboptimal capital budgets. To exercise and interpret the implications of simple tools of investment analysis (e.g., net present value [NPV], internal rate of return [IRR], payback), and to consider possible adjustments for differences among the projects in assay (e.g., through the use of risk-adjusted discount rates), size (e.g.

, through the profitability index), and life (e.g., through using equivalent annuities, replacement chains, or both). To consider the impact of behavioral influences on financial decision making. The roles in this case are overlaid with numerous possible conflicts among the decision makers: cross-cultural, cross-functional, and political. The case illustrates the potential effect of those conflicts, and provides some insights into remedies. Suggested Questions 1. Prepare to address the strengths and weaknesses of the various measures of investment attractiveness as used by Euroland Foods. Will all of the measures rank the projects identically? Why or why not?... If you want to get a near essay, order it on our website: Ordercustompaper.com

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