Compute Discounted Payback Period, Net Present Value and Profitability Index of a project which costs Rs 50,000, cost of capital is 8% and is expected to generate following cash inflows:Year Cash inflows(Rs) 1 12,000 2 15,000 3 25,000 4 28,000 5 20,000 6 22,000 On the basis of Net Present Value and Profitability Index, suggest if the project is to be accepted or not.
Compute Discounted Payback Period, Net Present Value and Profitability Index of a project which costs Rs 50,000, cost of capital is 8% and is expected to generate following cash inflows:Year Cash inflows(Rs) 1 12,000 2 15,000 3 25,000 4 28,000 5 20,000 6 22,000 On the basis of Net Present Value and Profitability Index, suggest if the project is to be accepted or not.
Chapter10: Capital Budgeting: Decision Criteria And Real Option
Section: Chapter Questions
Problem 7P
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Question
1. Compute Discounted Payback Period,
project which costs Rs 50,000, cost of capital is 8% and is expected to generate
following
1 12,000
2 15,000
3 25,000
4 28,000
5 20,000
6 22,000
On the basis of Net Present Value and Profitability Index, suggest if the project is to be
accepted or not.
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