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Project 4: Time Value of Money and Annuities Start Here

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Scenario

Your advice has helped Largo Global Inc. (LGI) make substantive progress. Now, you must provide the means to achieve this increase in efficiency and productivity. You must recommend a plan for making the strategic investments that will keep LGI moving on a sustainable path.

Your Project 4 business report will focus on which assets to invest in or whether to disinvest. You will identify the types of assets LGI should eventually acquire and/or renew. You will also determine the investments that will help LGI improve its operations and generate the cash flow needed to improve its bottom line. 

Competencies

Your work will be evaluated using the competencies listed below.

· 3.1: Identify numerical or mathematical information that is relevant in a problem or situation.

· 3.2: Employ mathematical or statistical operations and data analysis techniques to arrive at a correct or optimal solution.

· 3.3: Analyze mathematical or statistical information, or the results of quantitative inquiry and manipulation of data.

· 8.1: Evaluate major business/organizational systems and processes and make recommendations for improvement.

Project 4: Time Value of Money and Annuities Step 1: Prepare for the Project

For the next two weeks, you will focus on an investment strategy that will increase the efficiency and productivity of LGI to keep the company moving in the right direction. You will pay attention to which assets to invest in and divest from to generate cash flow and improve the bottom line.  Log into O'Reilly by following these instructions  and complete the required reading.

Required Reading

Parrino, R. Kidwell, D. S., & Bates, T. W. (2012).  Fundamentals of corporate finance . Wiley.

Chapter 5: The Time Value of Money

· Section 5.1 to 5.4

Chapter 6: Discounted Cash Flows and Valuation

· Sections 6.1 to 6.4

Recommended Reading

Davis, C. E. & Davis, E. (2011).  Managerial Accounting . Wiley.  Chapter 9, Capital Budgeting

Project 4: Time Value of Money and Annuities Step 2: Review and Practice

Using the Project 4 Review and Practice Guide, review investment techniques to set LGI on a path toward a sustainable future. Then apply what you have learned by completing the exercises and problems referenced in the Project 4 Review and Practice Guide. 

You must review the guide and do the practice exercises and problems so that you

· are prepared to have informed discussions with your team about LGI’s investment strategy,

· understand which assets LGI should acquire and/or renew, and

· can use this information to make recommendations for improvements.

Complete this review and practice by the end of Week 7. 

Review and Practice

You must complete the review and practice content to participate in the discussion in Step 3.

Project 4 Review and Practice Guide

Project 4: Time Value of Money and Annuities Step 3: Participate in the Required Project 4 Discussion

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You have finished reviewing the material and performing the exercises, but you have some questions. Participate in the Project 4 class discussion. Respond to the two questions below by posting in the discussion; then, respond to two of your classmates' discussion posts by the end of the week. 

Discussion

Discuss the concepts that were most challenging for you in the readings and review material. How did the practice exercises help clarify these?

What did you learn that will help you determine which assets to invest in and where to disinvest to help LGI improve its operations, generate cash flow, and improve the bottom line?  

Before you participate in the discussion activity, see  MBA discussion guidelines .

Course Resource

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MBA Discussion Guidelines

Throughout the MBA program, you will be asked to participate in discussions. Assigned discussions, both individual and group work, are part of the process of developing your project deliverables.

In general, address your discussion posts to your classmates, rather than the instructor. Do not attach files; use only the discussion textbox. Your posts do not need the structure or format of formal business memos or reports. These discussions should be an informal exchange of ideas with your peers. You should, of course, still adhere to the norms of standard written English.

To receive the maximum benefit, you should participate in accordance with the guidelines provided below.

· timeliness

· initial posting(s) submitted by 11:59 PM ET on Saturday

· response(s) to other discussion postings submitted by 11:59 PM ET on Tuesday

· proper citation

· cite sources any time you quote or paraphrase an idea or evidence from another work

· use APA citation style (example below)

· meaningful engagement

· posts contribute to substantive scholarly discussion

· student demonstrates professionalism in interaction with peers

· posts critically discuss topics presented in the current week and, when appropriate, in previous weeks

· posts are grounded in the theories and concepts presented in the course

Project 4: Time Value of Money and Annuities Step 4: Complete the Analysis Calculation for Project 4

Your team has provided you with an Excel workbook containing LGI's financials. You will use the  Project 4 Excel workbook  to perform discounting of cash flow and valuation calculations.

Complete the analysis calculation for the project:

· Download the  Project 4 Excel Workbook ,  click the Instructions tab, and read the instructions.

· Calculate and evaluate the investment choices using the worksheets.

· If you would like instructor feedback on this step, submit your Excel file to the Assignments folder as a milestone by the end of Week 7. This is optional. If you choose to submit the milestone, you will receive instructor feedback you may use to make corrections before submitting your final Project 4. To distinguish the milestone submission from the file you will submit in Step 5, label your file as follows: P4_milestone_lastname_Calculation_date

Project 4: Time Value of Money and Annuities Step 5: Prepare the Analysis Report for Project 4

You have developed an in-depth understanding of LGI's operating efficiency as it relates to costing and its impact on the bottom line. You feel confident that your investment choices will positively boost LGI’s productivity and improve the company’s operations. LGI will finally be on a path of a sustainable future. Answer the questions in the Project 4 Questions – Report Template document. Prepare your analysis report including recommendations for how the company can improve its financial situation.

Complete the analysis report:

Download the Project 4 Questions – Report Template

· Read the instructions.

· Answer all the questions.

· Include your recommendations.

· Submit the analysis report (Word document) and analysis calculation (Excel file) to the Assignments folder as your final deliverable at the end of Week 8. Label your files as follows:

· P4_Final_lastname_Report_date.docx

· P4_Final_lastname_Calculation_date.xlsx

Check Your Evaluation Criteria

Before you submit your assignment, review the competencies below, which your instructor will use to evaluate your work. A good practice would be to use each competency as a self-check to confirm you have incorporated all of them. To view the complete grading rubric, click My Tools, select Assignments from the drop-down menu, and then click the project title.

· 3.1: Identify numerical or mathematical information that is relevant in a problem or situation.

· 3.2: Employ mathematical or statistical operations and data analysis techniques to arrive at a correct or optimal solution.

· 3.3: Analyze mathematical or statistical information, or the results of quantitative inquiry and manipulation of data.

· 8.1: Evaluate major business/organizational systems and processes and make recommendations for improvement.