Profitability index. Given the discount rate and the future cash flow of each project listed in the following table, | use the PI to determine which projects the company should accept. What is the Pl of project A? (Round to two decimal places.) Project A should be (Select from the drop-down menu.) i Data Table What is the Pl of project B? (Round to two decimal places.) (Click on the following icon e in order to copy its contents into a spreadsheet.) Project B should be (Select from the drop-down menu.) Cash Flow Project A Project B Year 0 - $1,800,000 - $2,500,000 Year 1 $300,000 $1,250,000 Year 2 $450,000 $1,100,000 $950,000 $800,000 Year 3 $600,000 Year 4 $750,000 $900,000 Year 5 $650,000 Discount rate 4% 13%

Profitability index. Given the discount rate and the future cash flow of each project listed in the following table, | use the PI to determine which projects the company should accept. What is the Pl of project A? (Round to two decimal places.) Project A should be (Select from the drop-down menu.) i Data Table What is the Pl of project B? (Round to two decimal places.) (Click on the following icon e in order to copy its contents into a spreadsheet.) Project B should be (Select from the drop-down menu.) Cash Flow Project A Project B Year 0 - $1,800,000 - $2,500,000 Year 1 $300,000 $1,250,000 Year 2 $450,000 $1,100,000 $950,000 $800,000 Year 3 $600,000 Year 4 $750,000 $900,000 Year 5 $650,000 Discount rate 4% 13%

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter11: Cash Flow Estimation And Risk Analysis

Section: Chapter Questions

Problem 7MC: Calculate the project cash flows for each year. Based on these cash flows and the average project...

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Similar questions

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