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Question 12 Questions A9-A13 are based on the following information. Two projects have the same time to maturity of 5 years. The projects are mutually
Question 12 Questions A9-A13 are based on the following information. Two projects have the same time to maturity of 5 years. The projects are mutually exclusive. Start-up costs are $20,000 for project (S) and $35,000 for project (L). Cost of capital is 10% for each project. Project (S) generates cash flows of $7,500 per year for 5 years. Project (L) generates cash flows of $9,500 per year for 5 years. Al2. What is the profitability index for project S? (a) 1.346 b) 1.557 :) 1.258 ) 1.198 1.422
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