Question
You have been provided with the following details regarding potential capital investment projects for the current period. Given that you face a capital constraint of
You have been provided with the following details regarding potential capital investment projects for the current period. Given that you face a capital constraint of $20 million, which projects should you accept? Are all capital funds expended ?
| project | Initial Investment($M) | NPV Net Cash Flws($M) |
| Orian | 4.00 | 12.40 |
| Beta | 10.00 | 16.80 |
| Vega | 6.00 | -6.12 |
| Epsilon | 2.00 | 3.75 |
| Tau | 7.00 | 9.00 |
| Pi | 5.00 | 3.00 |
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Risk Management And Financial Institutions
Authors: John C. Hull
3rd Edition
1118269039, 9781118269039
