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suppose the capital budget in the lecture example worksheet was $100,000. What is the NPV of the best project(s)? Ranking by NPV Ranking by IRR
suppose the capital budget in the lecture example worksheet was $100,000. What is the NPV of the best project(s)?
Ranking by NPV Ranking by IRR or PI \begin{tabular}{lrrrrrrrr} Project & \multicolumn{2}{c}{ Initial Investment PV of Inflows NPV } & \multicolumn{2}{c}{ IRR } & \multicolumn{2}{c}{ PI } & \multicolumn{2}{c}{ Investment NPV } \\ B & $70,000 & $112,000 & $42,000 & 20.00% & 1.60 & $70,000 & $42,000 \\ C & $100,000 & $145,000 & $45,000 & 16.00% & 1.45 & $170,000 & $87,000 \\ E & $60,000 & $79,000 & $19,000 & 15.00% & 1.32 & $230,000 & $106,000 \\ A & $80,000 & $100,000 & $20,000 & 12.00% & 1.25 & & \\ F & $110,000 & $126,500 & $16,500 & 11.00% & 1.15 & & \\ D & $40,000 & $36,000 & $4,000 & 8.00% & 0.90 & \end{tabular} Ranking by NPV Ranking by IRR or PI \begin{tabular}{lrrrrrrrr} Project & \multicolumn{2}{c}{ Initial Investment PV of Inflows NPV } & \multicolumn{2}{c}{ IRR } & \multicolumn{2}{c}{ PI } & \multicolumn{2}{c}{ Investment NPV } \\ B & $70,000 & $112,000 & $42,000 & 20.00% & 1.60 & $70,000 & $42,000 \\ C & $100,000 & $145,000 & $45,000 & 16.00% & 1.45 & $170,000 & $87,000 \\ E & $60,000 & $79,000 & $19,000 & 15.00% & 1.32 & $230,000 & $106,000 \\ A & $80,000 & $100,000 & $20,000 & 12.00% & 1.25 & & \\ F & $110,000 & $126,500 & $16,500 & 11.00% & 1.15 & & \\ D & $40,000 & $36,000 & $4,000 & 8.00% & 0.90 & \end{tabular}Step by Step Solution
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