Question
Marge Simpson Inc. has following business opportunities with following cash flow information. Assume Marges opportunity cost of capital is 12%. Year Project A Project B
Marge Simpson Inc. has following business opportunities with following cash flow information. Assume Marges opportunity cost of capital is 12%.
| Year | Project A | Project B |
| 0 | $20,000 | $20,000 |
| 1 | 15,000 | 2,000 |
| 2 | 15,000 | 2,500 |
| 3 | 13,000 | 3,000 |
| 4 | 3,000 | 50,000 |
Calculate profitability index for both projects.
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Fixed Income Securities Tools For Todays Markets
Authors: Bruce Tuckman, Angel Serrat
3rd Edition
0470891696, 978-0470891698
