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A company is considering investing in the following one-period investments. The opportunity cost of capital (for all four investments) is 10%. Investment A B
A company is considering investing in the following one-period investments. The opportunity cost of capital (for all four investments) is 10%. Investment A B C D Initial Cash Flow -8,000 -9,000 -11,000 -12,000 a) What is the NPV for investment A? b) What is the profitability index for investment B? Cash Flow in Year 1 12,000 11,000 15,000 14,000
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