Question
The Weston Corporation is analyzing projects A, B, and C as possible investment opportunities. Each of these projects has a useful life of five years.
The Weston Corporation is analyzing projects A, B, and C as possible investment opportunities. Each of these projects has a useful life of five years. The following information has been obtained: Project A Project B Project C Initial investment required $ 500,000 $ 480,000 $ 630,000 Present value of future cash inflows $ 675,000 $ 520,000 $ 690,000 Internal rate of return 18 % 14 % 16 % Which project has the highest ranking according to the net present value and the project profitability index criteria? Net Present Value Profitability Index A) Project B Project B B) Project A Project A C) Project B Project A D) Project C Project C
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