Fin 301, Principles of Finance Capital Budgeting Assignment
All analysis should be done in MS Excel, and a memo to your boss explaining the situation, your
analysis and conclusion should be written in MS Word. You must upload both files to be graded) Zenix Corporation has a machine that requires repairs or should be replaced. You have recently
been hired by Zenix and one of your assignments is to help decide whether replacing the
machine or repairing it is in the best interest of your company.
Investment required for repairing the machine is only $2,500,000 and cost to replace the machine
is $12,500,000. Repairing the machine will cut down on the number of returns from customers
and increase cash flows, while replacing the machine may increase the number of units sold.
Zenix has evaluated and calculated additional cash flows that will be generated under the two
scenarios over the next five years as follows:
Year
1
2
3
4
5 Cash flow (if repaired)
955,000
900,000
878,000
751,000
487,000 Cash Flow (if replaced)
6,513,000
4,855,000
3,878,100
2,969,800
1,751,000 Cost of capital for the project (repair or replacement) may vary anywhere from 10 to 14% for
both scenarios. You should therefore conduct your analysis with at least five WACC points –
10%, 11%, 12%, 13% and 14%. Zenix does not like to accept projects that will pay back in more
than 3 years.
You must conduct the analysis using your knowledge of capital budgeting and time value of
money to decide which of the options is better for ZENIX. All analysis must be done in Excel.
Your excel model should be such that it can be used by ZENIX for other similar situations – so
anyone can change any numbers and use the model again. This would require all calculations to
be using cell references and excel functions.
You must write a memo to your boss, explaining the situation, your analysis, and your
conclusion. You must also explain the drawbacks of your technique/s if there are any.
NOTE: You will only get full credit for the assignment if your analysis is correct, all calculation cells are either cell
references or formulae, and your memo is properly formatted, grammatically correct, with the right content and
the right flow. Excel template with few inputs already entered is provided for your benefit. You need to complete at
least the areas highlighted in blue. Add rows and columns for additional calculations if you need them.
Plantextract_#1 Culture of Transformed Horseradish Roots as a Source of
Fusicoccin-Like Ligands
Plantextract_#2 Endogenous fusicoccin-like ligand revealed in higher plants
by radioreceptor and radioimmunoassays
Plantextract_#3 Fusicoccin-Like Ligands in the Axes of Horse Chestnut Seeds
Literature
A general piece about breast cancer and then zoom in on the estrogen receptors and more specifically the estrogen receptor alpha. Explain the disease mechanism and why it is a good therapeutic approach to target the estrogen receptor to stop breast cancer. Relate this receptor to breast cancer and also to the 14-3-3 (eta) protein.
Decribe the 14-3-3 protein class and its history and its role in plants and the human bodyand zoom in on the specific subclass 14-3-3?(14-3-3eta).
Then write about the Fusicocin which is found in the mold/fungusin almond trees and such and it activity and its history of discovery and function in plants. And then in humans also, so that it is a stabilizer of the 14-3-3 (eta) and estrogen receptor complex and therefore enhanced the effect of the complex and so on. Also explain binding modes and so on if possible. Then come back to how it can effect breast cancer in a positive way.
Of all three compounds I would like to have the physicochemical properties and thestructure and binding positions explained. So that 14-3-3 and estrogen receptor alpha bind and that fusicoccin stabilizes the complex.
Then coming to my research subject. Explain how Fusococcin is a hard to synthesize compound due to its structure and the stability of the structure and describe the different research articles where it is indicated that there might be plantextract containing fusicoccin-like compounds that might be having the same function as fusicoccin and how that is relevant for breast cancer research.
I’m adding also relevant literature that is named after the tile of the article. Hopefully this will help you to find it more easily. You can also add you own additional literature if you like. If you have any questions whatsoever, do ask them. I work during the day, so I might not be able to send you an answer immediately so bear with me.
