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Requirement 1 and 2 please! The management of Revco Products is exploring four different investment opportunities. Information on the four projects under study follows: Investment
Requirement 1 and 2 please!
The management of Revco Products is exploring four different investment opportunities. Information on the four projects under study follows: Investment required Present value of cash inflows Net present value Life of the project Internal rate of return $ (270,000) 336, 140 $ 66,140 6 years 184 Project Number 2 $ (450,000) $ (360,000) 522,970 433,400 $ 72,970 $ 73,400 3 years 198 140 4 $ (480,000) 567,270 $ 87,270 6 years 168 12 years The net present values above have been computed using a 10% discount rate. Limited funds are available for investment, so the company can't accept all of the available projects, Required: 1. Compute the profitability Index for each investment project. 2. Rank the four projects according to preference, in terms of net present value profitability Index, and internal rate of return. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the profitability Index for each investment project. (Round your answers to 2 decimal places.) Project Profitability Index 1 2 3 4 Required 1 Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Rank the four projects according to preference, in terms of net present value, profitability index, and internal rate of return. Not Present Value Profitability Internal Rato Index of Return First preference Second preference Third preference Fourth preference Step by Step Solution
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