Question
Robben Manufacturing has the following two possible projects. The required return is 11 percent. Year Project Y Project Z 0 $ 27,800 $ 58,000 1
Robben Manufacturing has the following two possible projects. The required return is 11 percent. Year Project Y Project Z 0 $ 27,800 $ 58,000 1 13,800 18,000 2 12,200 29,000 3 14,600 16,000 4 10,200 27,000 a. What is the profitability index for each project? (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.) Profitability index Project Y Project Z b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) NPV Project Y $ Project Z $ c. Which, if either, of the projects should the company accept?
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