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needed uregntly hamd written Q.1. If you are a Project Manager of Ghauri Builders. The director of capital budgeting asks you to analyze two proposed
needed uregntly hamd written
Q.1. If you are a Project Manager of Ghauri Builders. The director of capital budgeting asks you to analyze two proposed capital investments, Projects L and M. Each project has a cost of Rs.200,000/- and cost of capital for each project is 11%. The projects expected net cash flow are as follows: Year Project 'l' Project 'M' 1 50,000 45,000 50,000 65,000 50,000 70,000 4 50,000 35,000 5 50,000 85,000 Requirements: (a). Calculate each project's discounted payback period (DPBP), net present value (NPV), internal rate of return (IRR), and Profitability Index (PI). (b). Which project should be accepted if three projects are mutually exclusive based on DPBP, NPV, IRR and Pl techniques? (12 Marks)
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