Target Inc. has a project costing $40,000 and cash flows of $8,000, $15,600, and $22,700 for Years
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Question:
Target Inc. has a project costing $40,000 and cash flows of $8,000, $15,600, and $22,700 for Years 1 to 3, respectively. Based on the profitability index rule, should the project be accepted if the discount rate is 9.5 percent? Why or why not?
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