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Kartman Corporation is evaluating four different real estate investments. Management plans to buy the properties today and sell them three years from today. The annual
Kartman Corporation is evaluating four different real estate investments. Management plans to buy the properties today and sell them three years from today. The annual discount rate for these investments is 13%. The following table summarizes the initial cost and the sale price in three years for each property: Kartman has a total capital budget of $680,000 to invest in properties. Which properties should it choose? The profitability index for Parkside Acres is (Round to two decimal places.) (Click on the following icon in order to copy its contents into a spreadsheet.) Cost Today $590,000 820,000 Sale Price in Year 3 $1,090,000 1,420,000 Parkside Acres Real Property Estates Lost Lake Properties Overlook 580,000 980,000 90,000 290,000
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