Concord, Inc. is considering purchasing equipment costing $48000 with a 6-year useful life. The equipment will provide annual cost savings of $12000 and will be depreciated straight-line over its useful life with no salvage value. Concord requires a 10% rate of return. Present Value of an Annuity of 1 9% 6 4.623 4.486 Period 8% 10% 11% 12% 15% 4.355 4.231 4.111 3.784 What is the approximate profitability index associated with this equipment? O 109 O 0.73 O 106 O 125 of 1 used Submit Answer

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
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Concord, Inc. is considering purchasing equipment costing $48000 with a 6-year useful life. The equipment will provide annual cost
savings of $12000 and will be depreciated straight-line over its useful life with no salvage value. Concord requires a 10% rate of
return.
Period 8%
6
9%
4.623 4.486
Present Value of an Annuity of 1
11%
10%
4.355 4.231 4.111 3.784
O 109
O 0.73
O 106
O 1.25
What is the approximate profitability index associated with this equipment?
Save for Later
O
100
12%
47
15%
A
Attempts: 0 of 1 used Submit Answer
F10
F11
F12
Pr
Transcribed Image Text:Concord, Inc. is considering purchasing equipment costing $48000 with a 6-year useful life. The equipment will provide annual cost savings of $12000 and will be depreciated straight-line over its useful life with no salvage value. Concord requires a 10% rate of return. Period 8% 6 9% 4.623 4.486 Present Value of an Annuity of 1 11% 10% 4.355 4.231 4.111 3.784 O 109 O 0.73 O 106 O 1.25 What is the approximate profitability index associated with this equipment? Save for Later O 100 12% 47 15% A Attempts: 0 of 1 used Submit Answer F10 F11 F12 Pr
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