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Your company is considering a project with an initial outlay of $10,000 in year zero and the following cash flows over the next 4 years:
Your company is considering a project with an initial outlay of $10,000 in year zero and the following cash flows over the next 4 years:
Year | Cash flow |
1 | 2,000 |
2 | 3,000 |
3 | 4,000 |
4 | 5,000 |
Assuming cost of capital is 11%.
2) The project's Profitability Index is:
0.89 | ||
2.23 | ||
1.60 | ||
1.05 | ||
1.00 |
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