Question
As the director of capital budgeting for ABC Corporation, you are evaluating the following project with the following net cash flows: (cost of capital is
As the director of capital budgeting for ABC Corporation, you are evaluating the following project with the following net cash flows: (cost of capital is 7%)
| Project Z | |
| Year | Cashflow |
| 0 (initial investment) | -250,000 |
| 1 | 75,000 |
| 2 | 75,000 |
| 3 | 75,000 |
| 4 | 75,000 |
Calculate the profitability index for the project.
1.016
other
1.03
1.04
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Personal Finance Essentials Credit And Borrowing
Authors: Julia A Heath
1st Edition
1604139889, 9781604139884
