You have recently commenced employment with Projects Ltd. The company has decided to invest in a project costing $1,250,000, which is will be entirely financed by debt. The project is expected to commence on 1 November 2016 and will last 6 years. Projects Ltd is currently in a position where it has ample tangible assets to be used as security for any debt.
Your manager asks you to prepare a 700 word written report outlining how you would recommend the company arranges the debt financing. You are required to research current interest rates from at least 3 relevant Australian lenders and incorporate discussion of these into your report. Your report should include areas such as the type of debt you have recommended and why, cash flow considerations the company will need to be aware of when repaying the debt, and all supporting calculations, plus explanations of those calculations.
Your answer must be fully referenced and all calculations supporting the recommended decision are required within the word limit.