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2- Terence Hanchin must determine what investment opportunities to undertake for The Lake Tahow Ski Resort. He is limited to a maximum expenditure of $1.5
2- Terence Hanchin must determine what investment opportunities to undertake for The Lake Tahow Ski Resort. He is limited to a maximum expenditure of $1.5 million only for this capital budgeting period. Project A. Extend ski lift 3 B. Build a new sports shop C. Extend ski lift 4 D. Build a new restaurant E. Build addition to house complex F. Build an indoor skating rink Amount (ICO) $500,000 150,000 350,000 450,000 200,000 400,000 PI 1.22 0.95 1.20 1.18 1.19 1.05 If strict capital rationing for only the current period is assumed, which of the investments should be undertaken if you use PI first then NPV secondly? Which evaluation greatest the largest increase in shareholder wealth
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