Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The following details are provided by Doppler Systems: Project A Project B Project C Project D Initial investment $420,000 $200,000 $550,000 $500,000 PV of cash
The following details are provided by Doppler Systems:
Project A | Project B | Project C | Project D | |
Initial investment | $420,000 | $200,000 | $550,000 | $500,000 |
PV of cash inflows | $570,000 | $380,000 | $800,000 | $390,000 |
Payback period (years) | 3.6 | 3.2 | 4.0 | 2.0 |
NPV of project | $150,000 | $180,000 | $250,000 | ($110,000) |
What is the profitability index for Project B?
a. 1.90 | ||
b. 1.26 | ||
c.1.38 | ||
d. 1.98 |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started