Question
Company ABC is evaluating an investment project with the following cash flows: Initial Investment: $200,000 Year 1: $50,000 Year 2: $70,000 Year 3: $80,000 Year
Company ABC is evaluating an investment project with the following cash flows:
- Initial Investment: $200,000
- Year 1: $50,000
- Year 2: $70,000
- Year 3: $80,000
- Year 4: $90,000
- Year 5: $100,000
Calculate the profitability index (PI) for the investment and interpret the results.
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Corporate Finance and Investment decisions and strategies
Authors: Richard Pike, Bill Neale, Philip Linsley
8th edition
1292064064, 978-1292064161, 1292064161, 978-1292064062
