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CML Investment Ltd evaluating three mutually exclusive investment projects. Cash flows associated with these three projects have given below. Year Initial Cashflow Year 1
CML Investment Ltd evaluating three mutually exclusive investment projects. Cash flows associated with these three projects have given below. Year Initial Cashflow Year 1 Year 2 Year 3 Year 4 Year 5 X (81,200) 35,000 28,750 Project Y 36,625 Z (182,000) 46,625 46,625 46,625 46,625 46,625 (84,000) 18,125 20,000 18,750 17,750 46,000 The company expect 9% return on similar project. You are required to estimate the net present value, profitability index and the payback period of each project.
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To calculate the net present value NPV profitability index PI and payback period for each project we need to discount the cash flows using the companys expected return of 9 Project X Year 0 81200 Year ...
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Foundations of Finance The Logic and Practice of Financial Management
Authors: Arthur J. Keown, John D. Martin, J. William Petty
8th edition
132994879, 978-0132994873
