Evaluation of franchise investment
The franchise investment project is evaluated based on the net present value and the internal rate of returns. The available information is used to determine the NPV and IRR of Schneller Zug and Kyuko Densha. The two measures are used to assess whether each project is viable. NPV and IRR also help in choosing the better project between the two. NPV and IRR are determined using the cost of capital for Javelin Railway Co.
Determination of the cost of capital
The cost of capital is the return investors require from investment to secure funding. It is the minimum return projects must generate to be funded ...
