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Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract ABC NPV $2.04 million $0.98 million $1.52 million a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do? Use of Facility 100% 59% 41%

Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract ABC NPV $2.04 million $0.98 million $1.52 million a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do? Use of Facility 100% 59% 41%

Essentials Of Investments
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
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Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract A B с NPV $2.04 million $0.98 million $1.52 million a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do? a. What are the profitability indexes of the projects? The profitability index for contract A is Use of Facility 100% 59% 41% (Round to two decimal places.)
Transcribed Image Text:Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract A B с NPV $2.04 million $0.98 million $1.52 million a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do? a. What are the profitability indexes of the projects? The profitability index for contract A is Use of Facility 100% 59% 41% (Round to two decimal places.)
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