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Leaming Objectives The purpose of this case is to help you: - Students will possess knowledge of current theory and techniques of the major business discipline- - Students will exhibit the leadership capacity and teamwork skills for business decision making. - Students will understand the ethical implication of business decision making and recognize ethical dilemmas. - Students will demonstrate the ability to communieate effectively. - Students will demonstrate critical thinking skills. Part I Ali Harooz runs a small Business unit. He is concerned with the liquidity position of his firm as he has heard that liquidity problems are one of the most frequent explanations for business failure. The following data is available: Required Q1. Calculate the current ratio and liquidity (acid test) ratio based on the above data. ( 8 marks) 4 marks on each ratio calculation Q2. Give a brief evaluation of the liquidity position of Ali Harooz Business unit (2marks) Part II Company Seventh vision is considering an investment of $100,000. The useful life of the project is 10 years. The cutoff period is three (3) years. The board of directors has identified two alternatives A and B. The expected annual cash flows are as follows:(Using payback period) Q3. Suggest Seventh Vision which project is feasible to choose? (7 marks) Q4. Mentions any three valid reasons for choosing the particular project (3 Marks) Part III Q5. Why is important for firms to use pay back method in financial decision making give 5 valid reasons?(2.5 marks) Q6. Explain the accept and reject criteria of payback methods in detail.(2.5 marks)

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