Question
1. If Taylor Greene invests a maximum of __________ today at a rate of 8.7%, then he will approve a house renovation project that will
1.
If Taylor Greene invests a maximum of __________ today at a rate of 8.7%, then he will approve a house renovation project that will last for the next 7 years and is expected to generate a $101,200 annuity during that time.
Multiple Choice
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$514,502.63
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$427,526.73
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$922,559.54
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$458,064.36
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$497,588.37
2.
Today, Northwest Agricultural is investing $31,800 in a pears project with a cost of capital of 8.8%. The pears project will produce cash flows of $12,600 and $12,900, over the next two years, respectively. During its final two years, the pears project will produce cash flows of $16,000 and $10,500, respectively. What is the profitability index of the 4-year pears project?
Multiple Choice
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1.500
-
1.111
-
1.222
-
.750
-
1.333
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