Post a 250- to 350-word response that addresses the following:
Which location provides Polaris the greatest cost advantage? Calculate the NPV of the three locations using a 10% discount rate.
Would your recommendation change if the foreign exchange rate increased or decreased by 15%?
What other factors should be considered in making this decision?
Calculate a weighted scoring model. Decide on qualitative factors that you think
are important in this decision, e.g. location near R&D, quality, loss of intellectual
property, and currency risk. Then how much weight you would attach to factors such as
NPV and each of the other factors to total 100%. Then assign a score (1 to 10) to each
factor for each of the three locations. Calculate a total weighted score by multiplying the
weight times the factor score and adding over all factors for each location.
Which of the three locations do you recommend and why?