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.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter13: Capital Budgeting: Estimating Cash Flows And Analyzing Risk

Section: Chapter Questions

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

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