Give typing answer with explanation and conclusion A six-year project has an initial requirement of $308,000 for fixed assets and $22,750for net working capital. All of the net working capital will be recouped at the end of the project. The annual operating cash flow is $89,120 and the discount rate is 7.50 percent. What is the profitability index?
Give typing answer with explanation and conclusion A six-year project has an initial requirement of $308,000 for fixed assets and $22,750for net working capital. All of the net working capital will be recouped at the end of the project. The annual operating cash flow is $89,120 and the discount rate is 7.50 percent. What is the profitability index?
Chapter10: Capital Budgeting: Decision Criteria And Real Option
Section: Chapter Questions
Problem 1P
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Give typing answer with explanation and conclusion
A six-year project has an initial requirement of $308,000 for fixed assets and $22,750for net working capital. All of the net working capital will be recouped at the end of the project. The annual operating cash flow is $89,120 and the discount rate is 7.50 percent. What is the profitability index?
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