Respond to the following scenario with your thoughts, ideas, and comments. Be substantive and clear, and use research to reinforce your ideas. Apix is considering coffee packaging as an additional diversification to its product line. Here’s information regarding the coffee packaging project:Initial investment outlay of $40 million, consisting of $35 million for equipment and $5 million for net working capital (NWC) (plastic substrate and ink inventory); NWC recoverable in terminal year Project and equipment life: 5 years Sales: $27 million per year for five years Assume gross margin of 50% (exclusive of depreciation) Depreciation: Straight-line for tax purposes Selling, general, and administrative expenses: 10% of sales Tax rate: 35%Assume a WACC of 10%.Should the coffee packaging project be accepted? Why or why not? Compute the project’s IRR and NPV. In addition, answer the following questions: Do you believe that there was sufficient financial information to make a solid decision on what to do? Was there further financial information that you required that was not provided to you? What financial figure do you believe was the determinant to your decision and why? How would you be able to apply this particular financial information to other situations? Discuss risk methodologies used in capital budgeting.

Chapter 5. Business-Level Strategy: Creating and Sustaining Competitive Advantages Overview: Understanding the components of external and internal analysis, companies now have the building blocks and framework to develop strong business-levels strategies to create and sustain competitive advantages. There are three generic strategies: overall cost leadership, differentiation, and focus. This chapter explains how the successful attainment of generic strategies can improve the firm’s relative power and discusses the five forces that determine an industry’s average profitability. As managers evaluate these generic strategies, it is critical that they do not fall into specific pitfalls. Long term, the factors that determine the sustainability of a firm’s competitive advantage are discussed. Each company must evaluate where they are in the industry life cycle to determine their business-level strategy and have turnaround strategies to reposition themselves to be in a competitive position.   Chapter 5. Business-Level Strategy: Creating and Sustaining Competitive Advantages Learning Objectives The central role of competitive advantage in the study of strategic management and the three generic strategies: overall cost leadership, differentiation, and focus. How the successful attainment of generic strategies can improve the firm’s relative power vis-à-vis the five forces that determine an industry’s average profitability. The pitfalls managers must avoid in striving to attain generic strategies. How firms can effectively combine the generic strategies of overall cost leadership and differentiation. What factors determine the sustainability of a firm’s competitive advantage? The importance of considering the industry life cycle to determine a firm’s business-level strategy and its relative emphasis on functional area strategies and value-creating activities. The need for turnaround strategies that enable a firm to reposition its competitive position in an industry. Question Initial Postings: Read and reflect on the assigned readings for the week. Then post what you thought was the most important concept(s), method(s), term(s), and/or any other thing that you felt was worthy of your understanding.Also, provide a graduate-level response to each of the following questions: Research Amazon. How has this firm been able to combine overall cost leadership and differentiation strategies?