Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Transcribed Image Text: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.)
Transcribed Image Text:Cash Flow
Project A
Project B
- $1,800,000
- $2,500,000
$1,250,000
$1,050,000
Year 0
Year 1
$100,000
Year 2
$300,000
Year 3
$500,000
$850,000
Year 4
$650,000
$700,000
$900,000
Year 5
$450,000
Discount rate
5%
17%
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