Question
You are offered an investment with returns of $ 1,190 in year 1, $ 3,787 in year 2, and $ 5,367 in year 3. The
You are offered an investment with returns of $ 1,190 in year 1, $ 3,787 in year 2, and $ 5,367 in year 3. The investment will cost you $ 6,592 today. If the appropriate Cost of Capital (quoted interest rate) is 11.8 %, what is the Profitability Index of the investment?
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Financial Management Principles and Application
Authors: Arthur J. Keown, J. William Petty, David F. Scott, Jr.
10th edition
536514119, 536514110, 978-0536514110
