Question
Rostenkowski Ltd. has budgeted $2,500,000 for capital investment in the coming year. It is currently reviewing four projects. The CFO has gathered the following information
Rostenkowski Ltd. has budgeted $2,500,000 for capital investment in the coming year. It is currently reviewing four projects. The CFO has gathered the following information with respect to these projects:
|
Project |
Initial outlay | Net present value (NPV) |
| Q | $1,150,000 | $158,000 |
| R | $870,000 | $75,000 |
| S | $865,000 | $85,000 |
| T | $735,000 | $99,000 |
Each of the projects can be undertaken only once, and they are not divisible. Which of these projects should Rostenkowski invest in?
- Q, R, S, and T
- R, S, and T
- Q and R
- Q and T
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A Study In Public Finance
Authors: A. C. Pigou
1st Edition
1443722766, 978-1443722766
