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Mr. Amit Khan is considering on taking an investment. Assume an initial investment of $60,000 for the following two alternatives. At the end of the
Mr. Amit Khan is considering on taking an investment. Assume an initial investment of $60,000 for the following two alternatives. At the end of the third year an additional investment of $3000 will be required for Investment B. Assume the cost of capital is 12%. Calculate the Payback period, Net Present Value (NPV), Internal Rate of Return (IRR) and Profitability Index (PI). Which investment would you choose based on Payback period, NPV, IRR & PI?
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