Exercise B-1 Ranking Projects Based on the Profitability Index [LOB-1 MidWest Amusements is in the process of reviewing 10 proposals for new rides at its theme parks in cities scattered throughout the American heartiand. The company's only experienced safety engineer must carefully review plans and monitor the construction of all new rides. However, she is only available to work on new rides for 1,755 hours during the year. The net present values and the amount of safety engineer time required for the proposed rides are listed bellow Safety Engineer Time Required Proposed Ride Ride 1 Ride 2 Ride 3 Ride 4 Ride 5 Ride Net Present Value $1,288.000 1.190.000 681.800 504,150 552.500 526.225 384,000 1,802.100 347.700 452.400 (hours) 350 340 320 170 250 155 120 370 190 200 Ride 7 Ride 8 Ride Ride 10 8 Total S7,818,675 2.525 Required: 1. Which of the proposed rides should the company build this year? (Note: The incremental profit of a lona-term project such as constructina a new ride is its net present value.) (You may select more than one answer, Single click the box with a check mark for correct answers and double click to empty the box for the wrong answers.) Ride 1 Ride 6 Ride 3 Ride 2 Ride 5 Ride 4 Ride 8 Ride 10 Ride 7 Ride 9 2. What would be the total net present value of the rides built under your plan? Total Exercise B-1 Ranking Projects Based on the Profitability Index [LOB-1 MidWest Amusements is in the process of reviewing 10 proposals for new rides at its theme parks in cities scattered throughout the American heartiand. The company's only experienced safety engineer must carefully review plans and monitor the construction of all new rides. However, she is only available to work on new rides for 1,755 hours during the year. The net present values and the amount of safety engineer time required for the proposed rides are listed bellow Safety Engineer Time Required Proposed Ride Ride 1 Ride 2 Ride 3 Ride 4 Ride 5 Ride Net Present Value $1,288.000 1.190.000 681.800 504,150 552.500 526.225 384,000 1,802.100 347.700 452.400 (hours) 350 340 320 170 250 155 120 370 190 200 Ride 7 Ride 8 Ride Ride 10 8 Total S7,818,675 2.525 Required: 1. Which of the proposed rides should the company build this year? (Note: The incremental profit of a lona-term project such as constructina a new ride is its net present value.) (You may select more than one answer, Single click the box with a check mark for correct answers and double click to empty the box for the wrong answers.) Ride 1 Ride 6 Ride 3 Ride 2 Ride 5 Ride 4 Ride 8 Ride 10 Ride 7 Ride 9 2. What would be the total net present value of the rides built under your plan? Total
