Question
Your firm has $2,000,000 available for investment in capital projects. Which combination of projects is the best, given this budget constraint? (Hint: Non-used part of
Your firm has $2,000,000 available for investment in capital projects. Which combination of projects is the best, given this budget constraint? (Hint: Non-used part of the budget would provide no NPV.)
| Project | Initial Investment | NPV |
| A | $750,000 | $100,000 |
| B | $900,000 | $125,000 |
| C | $400,000 | $50,000 |
| D | $500,000 | $70,000 |
| E | $800,000 | $110,000 |
B, C, D
A, B
A, C, E
B, E
C, D, E
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The Dark Side Of Valuation
Authors: Aswath Damodaran
3rd Edition
0134854101, 9780134854106
