Case: "Fonderia del Piedmont S.p.A."
Assignment Questions:
Assess the economic benefits of acquiring the Thor MM-9 machine? What is the initial outlay? What are the benefits over time? What is the appropriate discount rate? Does the net present value (NPV) warrant the investment in the machine?
What uncertainties or qualitative considerations might influence your recommendations (e.g. inflation, discount rate, inability to lay off existing workers, a reduction in the daily operating hours due to economic slowdown)? Please estimate the impact on NPV from a change in any one of those elements.
Should Martina Bellucci proceed with the project?

Q&A Education