3. A Project X initially costing $ 250,000 generates following cash flows. If the cost of capital is 12%, calculate a) Net Present Value b) Profitability Index of the project. Year Cash flow I 90,000 II 80,000 III 70,000 IV 60,000 V 50,000 Whether the project should be accepted or not?
3. A Project X initially costing $ 250,000 generates following cash flows. If the cost of capital is 12%, calculate a) Net Present Value b) Profitability Index of the project. Year Cash flow I 90,000 II 80,000 III 70,000 IV 60,000 V 50,000 Whether the project should be accepted or not?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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3. A Project X initially costing $ 250,000 generates following cash flows. If the cost of capital is 12%, calculate a) Net Present Value b) Profitability Index of the project.
Year
Cash flow
I
90,000
II
80,000
III
70,000
IV
60,000
V
50,000
Whether the project should be accepted or not?
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