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A company is reviewing its annual budget in wireless technology. It is considering investments into three different tyoes of wireless technologies: L6, G5, Wi-fi. Consider
A company is reviewing its annual budget in wireless technology. It is considering investments into three different tyoes of wireless technologies: L6, G5, Wi-fi. Consider the following cash flows of the three independent projects. Assume the discount rate is 11%. Firhter, the company has only $20 million to invest in the new projects. Calculate the profitability index for each investment, as well as the NPV, given the following data: L6 Year 0: -7.0, Year 1: 10.0, Year 2: 6.5, Year 3: 4.5. The G5 Year 0: -13, Year 1: 11, Year 2: 26, Year 3: 20. The Wi-fi Year 0: -20, Year 1: 18, Year 2: 32, Year 3: 20.
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