1. Given the two projects below, identify which of the two projects are worth pursuing. The required rate of return is 10%. Project A ( 100,000 ) 45,000 45,000 45,000 Project B ( 100,000 ) 75,000 30,000 1,000 Year 1 2 3 Required: Compute for simple payback period, discounted payback period, net present value, profitability index, and internal rate of return.
1. Given the two projects below, identify which of the two projects are worth pursuing. The required rate of return is 10%. Project A ( 100,000 ) 45,000 45,000 45,000 Project B ( 100,000 ) 75,000 30,000 1,000 Year 1 2 3 Required: Compute for simple payback period, discounted payback period, net present value, profitability index, and internal rate of return.
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:1. Given the two projects below, identify which of the two projects are worth
pursuing. The required rate of return is 10%.
Project A
( 100,000 )
45,000
45,000
45,000
Project B
( 100,000 )
75,000
30,000
1,000
Year
1
2
3
Required: Compute for simple payback period, discounted payback period, net present
value, profitability index, and internal rate of return.
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