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First United Bank Inc. is evaluating three capital investment projects using the net present value method. Relevant data related to the projects are summarized as
First United Bank Inc. is evaluating three capital investment projects using the net present value method. Relevant data related to the projects are summarized as follows:
Branch
Office
Expansion Computer
System
Upgrade ATM
Kiosk
Expansion
Amount to be invested $ $ $
Annual net cash flows:
Year
Year
Year
Present Value of $ at Compound Interest
Year
Required:
Assuming that the desired rate of return is prepare a net present value analysis for each project. Use the present value of $ table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest dollar.
Branch
Office
Expansion Computer
System
Upgrade ATM Kiosk
Expansion
Present value of net cash flow total $fill in the blank
$fill in the blank
$fill in the blank
Less amount to be invested: $fill in the blank
$fill in the blank
$fill in the blank
Net present value $fill in the blank
$fill in the blank
$fill in the blank
Determine a present value index for each project. If required, round your answers to two decimal places.
Present Value Index
Branch Office Expansion fill in the blank
Computer System Upgrade fill in the blank
Install Internet BillPay fill in the blank
Which project offers the largest amount of present value per dollar of investment?Net Present Value Method, Present Value Index, and Analysis
First United Bank Inc. is evaluating three capital investment projects using the net present value method. Relevant data related to the projects are summarized as follows:
Required:
Determine a present value index for each project. If required, round your answers to two decimal places.
Present Value Index
Branch Office Expansion
Computer System Upgrade
Install Internet BillPay
Which project offers the largest amount of present value per dollar of investment?
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