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Pages:
2 pages/≈550 words
Sources:
2 Sources
Style:
APA
Subject:
Management
Type:
Essay
Language:
English (U.S.)
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MS Word
Date:
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Topic:

The Decision and the Primary Goal of Any Business

Essay Instructions:

This writing assignment should be in an essay format. It should use two or more published news or academic articles which are less than a year old as cited references. This writing assignment addresses the values learning outcome (LO7) as detailed in the syllabus.
For this assignment, assume that you are a corporate manager that needs to make an important decision. Your company currently has its largest factory (700 employees) located in the Midwestern United States. This factory is currently not competitive in international markets and its poor results are threatening to force the entire company into bankruptcy. The company employs 3,000 in other areas of the U.S. You have to decide whether to keep the factory where it is or move it to Canada or Ireland.
You can only keep one factory open. The corporate tax rates of Canada (20%) and Ireland (15%) are much lower than the U.S. (35%). Labor costs will not change significantly because the cost of training new employees will be offset by the replacement of highly paid senior employees with younger employees in the other countries. The old factory needs extensive renovation which will still not leave it as efficient as the new factories planned for the new countries. Therefore, the NPV of the capital investments involved are equal for all three countries.
You have calculated the NPV of each choice. The NPV of keeping the U.S. factory open is $1,000,000. The NPV of moving the factory to Canada or Ireland is $10,000,000 and $35,000,000 respectively.
In this writing assignment, you should answer the following questions:
• Where should your factory be located? Why?
• Who are the stakeholders in this decision? How did you take the stakeholders into account when making your decision?
• How does your decision support responsible stewardship and integrity in the context of financial management?

The essay will be in APA format and be 500-1,000 words in length (this range includes everything in the assignment including your name, title, and citations). Turnitin.com software will be used to ensure that submitted assignments are original works. See the rubric on the next page for complete grading criteria. Recent published news or academic articles are available in the ProQuest database at the Saint Leo University Library website. Click here for instructions on accessing ProQuest.

Essay Sample Content Preview:

The Decision
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Introduction
The primary goal of any business venture is to remain profitable. There are multiple factors that come into play and which determine the ability of a business to remain profitable and afloat. In order to increase profitability, continuous investment in business is inevitable. However, investment must be done from a sound perspective so as to make business sense (Kendrick, 2012). This means that managements of business organizations must carefully consider a number of facts before embarking on any investment project. This paper has taken a look at some of the evaluations that corporate managers have to take in making the big decisions on investments.
Net Present Value (NPV)
Net present value is calculated by considering the value of cash outflows at present and the value attached to the cash inflows at present (Mandura, 2011). The difference between the two is what is referred to as net present value. NPV is used by businesses when carrying out budgeting. This helps in assessment of new projects so as to determine the possible return on the investment of the project.
Case Study
In the case study provided, the largest factory of the business located in the United States has proven uncompetitive in the international. Comparing to the other NPVs, it seems the better option is to keep the U.S factory open. However, in consideration of the fact that it is not well aligned in the international market, moving to another location is inevitable. Further, the fact that the factory in America will still need renovation and even then it will still not be as efficient as the newly set factories in Ireland or Canada, it is time to close and exit American mark...
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