Question
Lambda Corp has two investment opportunities with the following characteristics: Period Project S Cost Project S Net Cash Flow Project T Cost Project T Net
Lambda Corp has two investment opportunities with the following characteristics:
Period | Project S Cost | Project S Net Cash Flow | Project T Cost | Project T Net Cash Flow |
0 | 9,000 | - | 10,000 | - |
1 | 4,000 | 5,000 | 5,000 | 4,000 |
2 | 3,000 | 5,000 | 3,000 | 5,000 |
3 | 2,000 | 6,000 | 2,000 | 6,000 |
For each project, compute its payback period, net present value, and profitability index using a discount rate of 11%.
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
12th edition
978-0324597714, 324597711, 324597703, 978-8131518571, 8131518574, 978-0324597707
