Natasha's Flowers, a local florist, purchases fresh flowers each day at the local flower market. The buyer has a budget of $1,000 per day to spend. Different flowers have different profit margins, and also a maximum amount the shop can sell. Based on past experience the shop has estimated the following NPV of purchasing each type: (Click on the following icon in order to copy its contents into a spreadsheet.) Roses Lilies Pansies Orchids NPV per Bunch $3 8 4 20 What combination of flowers should the shop purchase each day? Roses Cost per Bunch $20 30 30 80 The profitability index for each choice is: (Round to three decimal places.) NPV per bunch Max. Bunches $3 25 Cost per bunch $20 Max. Bunches 25 10 10 5 Profitability Index (per bunch)
Natasha's Flowers, a local florist, purchases fresh flowers each day at the local flower market. The buyer has a budget of $1,000 per day to spend. Different flowers have different profit margins, and also a maximum amount the shop can sell. Based on past experience the shop has estimated the following NPV of purchasing each type: (Click on the following icon in order to copy its contents into a spreadsheet.) Roses Lilies Pansies Orchids NPV per Bunch $3 8 4 20 What combination of flowers should the shop purchase each day? Roses Cost per Bunch $20 30 30 80 The profitability index for each choice is: (Round to three decimal places.) NPV per bunch Max. Bunches $3 25 Cost per bunch $20 Max. Bunches 25 10 10 5 Profitability Index (per bunch)
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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Transcribed Image Text:Natasha's Flowers, a local florist, purchases fresh flowers each day at the local flower market. The buyer has a budget of $1,000 per day to spend. Different flowers have different profit margins, and also a maximum amount the shop can sell. Based
on past experience the shop has estimated the following NPV of purchasing each type: (Click on the following icon in order to copy its contents into a spreadsheet.)
NPV per Bunch
$3
8
4
20
What combination of flowers should the shop purchase each day?
Roses
Lilies
Pansies
Orchids
Cost per Bunch
$20
30
30
80
The profitability index for each choice is: (Round to three decimal places.)
NPV per
Max.
Bunches
bunch
$3
25
Roses
Cost per
bunch
$20
Max. Bunches
25
10
10
5
Profitability Index
(per bunch)
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