Assuming end of your cash flows and a year planning horizon, should Ford give the incentive
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Assuming end of your cash flows and a year planning horizon, should Ford give the incentive

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The Ford Motor Company wants to decide if the company should provide a incentive to purchasers of the Ford Fusion. Here are some details for the base case:

Year price: 

Year cost: % of the market purchases a Ford Fusion or competitive vehicle % of everybody who last purchased a Ford Fusion will purchase the same vehicle again.

% of all people who bought a competitive car will purchase a Ford Fusion for their next vehicle

The market splits half are loyal to Ford and the other half is loyal to their current preferred manufacturer Inflation rate is % annually

Profit hits the financials at the beginning of the year and The Ford Motor Company discounts the cash flows at % per year

With this information, please answer the following questions:

a) Assuming end of your cash flows and a year planning horizon, should Ford give the incentive? Why or why not?

b) Would decreasing the discount rate to % change your answer? Why or why not?

Please submit this project as a Microsoft Excel spreadsheet showing your worked answer with your response to both a and b above

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Hint
BusinessThe predictive analysis includes and pertains to a variety of techniques in statistics in the mining of data and also in predictive modeling and analyzing past, current and historical facts in order to make predictions about the future or events that are or may happen in the future. In business and economics, they exploit patterns found in the various transactions....

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