Question

In determining the viability of a strategic investment, several pieces of information are required, including the cost of the project, the projected cash flows, and the discount, or interest, rate. In the Guillermo Furniture Scenario, which costs would you NOT consider, and why? Are there also certain non-financial factors that would impact your decision for Guillermo? Additionally, think about today's economy. Would the discount rate to be used in the time value of money calculations for Guillermo likely be higher or lower than it was eight years ago? Why?