Investment Proposal A Investment required..... Present value of cash infiows. Net present value ... Life of the project $(90,000) $(100,000) 138.000 $ 38,000 $(70,000) 105,000 $(120,000) 126,000 $ 36.000 160,000 $ 40,000 .... $35,000 5 years 7 years 6 years 6 years
Investment Proposal A Investment required..... Present value of cash infiows. Net present value ... Life of the project $(90,000) $(100,000) 138.000 $ 38,000 $(70,000) 105,000 $(120,000) 126,000 $ 36.000 160,000 $ 40,000 .... $35,000 5 years 7 years 6 years 6 years
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Preference Ranking
Information on four investment proposals is given below
Required:
1. Compute the project profitability index for each investment proposal.
2. Rank the proposals in terms of preference.:
![Investment Proposal
A
Investment required.....
Present value of cash infiows.
Net present value ...
Life of the project
$(90,000)
$(100,000)
138.000
$ 38,000
$(70,000)
105,000
$(120,000)
126,000
$ 36.000
160,000
$ 40,000
....
$35,000
5 years
7 years
6 years
6 years](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4b5296d9-1571-4bcb-a7f9-dac98988d99c%2F1cc71151-78a5-403c-a825-7b2632dfde22%2Fadaa8a.png&w=3840&q=75)
Transcribed Image Text:Investment Proposal
A
Investment required.....
Present value of cash infiows.
Net present value ...
Life of the project
$(90,000)
$(100,000)
138.000
$ 38,000
$(70,000)
105,000
$(120,000)
126,000
$ 36.000
160,000
$ 40,000
....
$35,000
5 years
7 years
6 years
6 years
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