Question
Your firm has a fixed capital budget this quarter of $1.4 million. As a result, the cost of capital is set at 20%. Calculate the
Your firm has a fixed capital budget this quarter of $1.4 million. As a result, the cost of capital is set at 20%. Calculate the profitability index (PI) of your proposed project (all numbers in thousands):
| Year | 0 | 1 | 2 | 3 | 4 |
| Free cash flow | -$855 | $200 | $300 | $400 | $500 |
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Financial Management Principles And Applications
Authors: Sheridan Titman, Arthur Keown, John Martin
13th Global Edition
1292222182, 978-1292222189
