The Cost and Benefits of Various Expansion Options Essay

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MS PowerPoint Presentation with slide speaker notes. Pleade find a writer that is proficientint in Economics/Business, and I need this without delays. Please refer to all files and the information will be there. I will post the grading rubics ASAP, but the files should be very thorough. Thanks.
Task Type: Individual Project Deliverable Length: 6-8 slides with notes (200-250 speaker notes per slide)
The Board liked the analysis you did on valuation and agreed to proceed with the expansion plan. Your CFO, investment bankers, and consultants have all been working on the cost and benefits of various expansion options. They have agreed on an option that will see simultaneous expansion into 5 domestic markets (Chicago, Dallas, Miami, New York, and Charlotte), Germany, and Brazil. The CFO has developed cost and benefits of the scenario in a spreadsheet and has asked you to review it.
Look at the spreadsheet and use present value analysis to discount the cash flows. Determine if the project is a net positive or negative impact on the firm, NPV. Calculate the certainty equivalent cash flows and NPV. What kind of questions would you ask the CEO about economic assumptions? Articulate the economic and political risk with the strategy and list options to overcome. Should this approach to expansion be adopted? (Answer using CE cash flows and non-CE cash flows.
Objective:
• Apply various risk methodologies to economic situations using a variety of approaches ranging from basic statistics to certain equivalency.
• Discuss the relevant distinctions necessary to conduct cost analysis and cost estimation in economic settings.
Please submit your assignment.
For the CEO’s spreadsheet, click here. Please refer to additional file with spread sheet in Adobe format.

Instructor Comments:
When using the spreadsheet and calculating NPV; assume you are in the year 2005 making 2006-2010 (the last year is mislabeled 2009) future years. The Capital Investment is the amount of money (in millions) that CPI is investing in their expansion efforts (this is important to keep in mind when determining the present value of future cash flows!) Calculate the NPV of the cash flows expected in 2006-2010 using only the 2005 Cost of Capital (don’t worry about increasing costs of capital). Determine the NPV to see if CPI should go ahead with expansion. Is the NPV positive or negative? Should CPI go ahead with the expansion? Why or why not?

Don’t worry about determining the CE or risk-free cash flows; we’re more concerned with the NPV of future cash flows here.

Expansion is happening in Germany and Brazil, not just domestically; what kind of risks does global expansion pose? How might political unrest affect CPI? What about cultural issues?
A minimum of five references are required
Please review the grading rubric to focus your efforts!
Phase Resources:
• About.com
Includes articles re. US unemployment, newly released information, economics glossary and terms
• National Archives of Australia- Dirks
Simple explanation of cost benefit analysis
• National Association for Business Economics
Articles, links, careers, economic outlook
• The New Palgrave
Economics encyclopedia includes many links to microeconomic information.

Scenario: Phase _3 PPT. Presentation Assignment
Consumer Products Inc. (CPI) is a U.S. regional Consumer Products Company located in Phoenix, Arizona. The company manufactures and distributes a small line of consumer products to retailers in major western cities including Los Angeles, San Francisco, Seattle, Portland, and Phoenix. The company has an excellent reputation as a good corporate citizen and producer of some of the highest quality products in the business.
CPI’s three major brands are Shades of Youth, a hair care line that recently has been doing extremely well as the aging baby boomers look for products to help retain some of their youth; Super Clean, a line of detergent and bleach products; and Super White, a line of tooth paste that quickly and safely whitens teeth. Super Clean is the anchor division, and it was the sole line of products the company had when Javier Lopez founded it in 1951. The company launched Shades of Youth in 1975 and Super White in 1980.
You have headed up the Super Clean division for the last 8 years and were recently promoted to Chairperson of the Board and Chief Executive Officer (CEO). The firm went public ten years ago under the leadership of your predecessor as CEO, Regina Baker. CPI is well established on Wall Street and has a reputation of being a good company that is conservative and a safe investment.
With only a U.S. regional presence and $200 million in revenue, you are clearly aware that the company’s ability to compete with the industry giants (Procter & Gamble, Unilever, Colgate, and Gillette) is limited. You believe that the firm must expand to other regions in the U.S. and begin international expansion if it is going to grow and prosper over the next decade.
The Board has reservations about making such bold moves, arguing that the company has been a successful regional company for over 50 years and can remain a niche player in the consumer products business. You see things differently. You see that the market is changing and competitors are becoming more aggressive by making acquisitions or developing new products that are extremely competitive with CPI’s brands. More importantly, you believe that the company will either be crushed by competition or forced into a merger to survive.
You know the task ahead of you is daunting. As you approach the challenge of persuading the Board to expand, you believe it is critical that you outline the global macroeconomic issues that are driving the industry and articulate the microeconomic dynamics that are central to the firm’s success. Ultimately, you see this as a decision-making problem. The Board must make the right decision now because the survival of the firm is at stake.

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