Answer:
There are multiple ways the management can achieve this.
Explanation:
Having a stake in something grants one benefits should it succeed.
If ABTronics’ management aims to persuade its staff regarding their investment in the firm's success, they could consider the following approaches:
1. Raise their salaries
2. Provide bonuses for extra hours worked.
3. Offer festival bonuses as well.
4. Reduce the workload by hiring additional employees.
5. Expand by opening more branches.
Thus, the internal rate of return stands below the anticipated rate, and therefore the project should be rejected. To elaborate, the cash flow for the project over years 0 to 3 consists of amounts: -$161,900, $60,800, $62,300, and $75,000. The required rate of return is 13%. Let's denote the internal rate of return as y%. At this rate, the present value of inflows equals the present value of outflows, leading to the equation for internal rate of return: 161900 = 60800/1.0y + 62300/1.0y^2 + 75000/1.0y^3. This gives an internal rate of return of y = 10.41%.
