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A company is planning to expand its business is costing OMR 21756. The following cash inflows are expected. Calculate Profitability index given the rate of discounting to be 3.008%

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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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

A company is planning to expand its
business is costing OMR 21756. The
following cash inflows are expected.
Calculate Profitability index given the
rate of discounting to be 3.008%
Machine A
Years
12960
1
13300
2
12500
14500
4
اخترأحد الخيارات
a. 27675.7870
b. 0.440
c. none of the options O
d. 2.289 O
e. 2.272 O
3.

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