The financial aspect of the company is studied using various methodologies such as cash flow analysis and various investment evaluation methods. In this project we chose to use the NPV and IRR methods for investment evaluation for several reasons. Valuation of investments could also have been done with other methods such as payback period, but the disadvantage of this method is that it does not consider cash flows that come after the payback period and therefore in some cases can lead to foolish decisions. On the other hand NPV and IRR are both more reliable because they consider all cash flows until the end of the project. Furthermore, in the payback period method, equal weight is given to all cash flows that arrive before the payback period, despite the fact that cash flows further away are less valuable. This problem is also overcome with the NPV and IRR methods because they both consider the time value of money. Again the NPV and IRR methods also help to ensure whether the investment will increase the value of the business. Other methods cannot provide this information. The accounting rate of return method for valuing investments was also rejected for use in this project because it only considers profits which do not equate to liquidity and also does not consider the time value of money. Cash Flow Analysis: This is performed for each model to analyze the company's financial health over a 5-year model period. On the other hand, investment valuation is necessary to evaluate the attractiveness of an investment (in this case the business model) and is an integral part of the capital budget. For this project the investment evaluation is performed with the following methods. Net present value (NPV) is the difference between the present value of cash inflows and outflows and can be...... middle of paper... licensing and public policy». Research Policy, 15 (6) 285–305. Tsang, E. W. K. (2002) “Acquiring Knowledge from Foreign Partners from International Joint Ventures in a Transition Economy: Learning by Doing and Learning Myopia.” Strategic Management Journal, 23 (9) 835-854.UK Increasingly a nation of entrepreneurs. (2003) Available from: http://www.prnewswire.co.uk/cgi/news/release?id=114873 [Accessed 22 July 2011].Williamson, OE (1975) Markets and hierarchies: analysis and antitrust implications. New York: Free Press.Williamson, OE (1985) The Economic Institutions of Capitalism: Firms, Markets, Relational Bargaining. New York: New York University Press.Zhang, H., Shu, C., Jiang, X. and Malter, A. (2010) 'Managing knowledge for innovation: the role of cooperation, competition and nationality 'alliance". International Marketing Journal, 18 (4) 74-94.