Question
Mountain Manufacturing is considering the following capital investment proposals. Mountain's requirement criteria include a maximum payback period of five years and a required rate of
Mountain Manufacturing is considering the following capital investment proposals. Mountain's requirement criteria include a maximum payback period of five years and a required rate of return of 12.5%. Determine if each investment is acceptable or should be rejected (ignore qualitative factors). Rank the acceptable investments (Click the icon to view the capital investment proposals.) in order from most desirable to least desirable. Determine if each investment is acceptable or should be rejected (ignore qualitative factors). (Evaluate the criteria of each investment separately.) Project Project A Payback Project B Project C Project D NPV IRR Profitability index Project E Rank the acceptable investments in order from most desirable to least desirable. Acceptable investments are those which are not rejected by any of the capital budgeting methods. (Rank the criteria of each investment separately. 1 = most desirable.) Payback Profitability index NPV IRR Rank Rank 1 Rank 2 Rank 3 Rank 4 Data Table Project A Project B Project C Payback NPV 3.15 years 4.20 years 2.00 years Project D 3.25 years Project E 5.00 years $ 10,250 IRR 13.0% $ 42,226 14.2% $ (10,874) $ 36,251 $0 8.5% 14.0% 12.5% Profitability Index 1.54 1.92 0.75 2.86 1.00 Print Done Choose from any drop-down list and then continue to the next question. - X 13
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