HDW Co is a listed company which plans to meet increased demand for its products by buying new machinery costing $5 million.

This investment will increase production capacity by 9,000 units per year and all of these units are expected to be sold as they are produced.

The net present value of the planned purchase of the new machinery using a nominal (money terms) approach is $4·161 million.

Required:

Identify TWO financial objectives of a listed company such as HDW Co and discuss how each of these financial objectives is supported by the planned investment in new machinery.

(6 marks)