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Only answer if answering all questions, please! Thank you. 2. Comparing Investment Criteria The treasurer of Amaro Canned Fruits, projected the cash flows of projects
Only answer if answering all questions, please! Thank you.
2. Comparing Investment Criteria The treasurer of Amaro Canned Fruits, projected the cash flows of projects A, B, and C as follows: Year Project A Project B Project C $150,000 110,000 110,000 $300,000 200,000 200,000 $150,000 120,000 90,000 0 2 Suppose that relevant discount rate is 12% a year. a. Compute the profitability index for each of the three projects b. Compute the NPV for each of the three projects c. Suppose these projects are independent. Which project(s) should Amaro accept based on the profitability index rule? on the profitability index rule? project(s) should Amaro accept? d. Suppose these three projects are mutually exclusive. Which project(s) should Amaro accept based e. Suppose Amaro's budget for these projects is $450,000. The projects are not divisible. WhichStep by Step Solution
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