The following table gives the available projects (in $millions) for a firm. A B C D...

The following table gives the available projects (in $millions) for a firm.

A	B	C	D	E	F	G
90	20	60	50	150	40	20	Initial investment
140	70	65	−10	30	32	10	NPV

If the firm has a limit of $210 million to invest, what is the maximum NPV the company can obtain?

Explain how you decided to prioritize the projects (i.e. use Profitability Index or just reference NPV)

Expert Solution

Projects will be chosen on the decreasing order of NPV till it reaches the investment limit of $ 210 million. NPV provides the highest value addition to the shareholders.

Project A will be chosen first as its NPV is highest - So investment = $ 90 M - NPV = 140

Project B will be the next - Cumulative investment = 90+20 =110, NPV = 70

Project C is next, Cumulative investment = 90+20+60 = 170, NPV = 65

Project F is next, Cumulative investment = 90+20+60 + 40 = 210 M , NPV = 32

As the cumulative investment reaches the limit, the above projects are chosen ie Project A,B,C and F

Maximum NPV = 140 + 70+ 65 + 32 = $ 307 M

jeff jeffy answered 2 years ago

The volume and weight of items A, B, C, D are shown in the following table....

The volume and weight of items A, B, C, D are shown in the following table. Item Volume (in3) Weight (lb) A 80 300 B 20 400 C 100 200 D 60 400 (1) How can a shipment of 16 items be made if the shipment has a total volume of 1200 in3 and total weight 4800 lb? (2) Is there any way to ship exactly 5 items of type C?

JPMorgan Chase is considering the following mutually exclusive projects: A, B, C, D, and E with...

JPMorgan Chase is considering the following mutually exclusive projects: A, B, C, D, and E with the following cash flows: A: Initial Investment = -$15,000, Year 1 = $20,000, Year 2 = $25,000 B: Initial Investment = -$10,000, Year 1 = $14,000, Year 2 = $20,000 C: Initial Investment = -$12,000, Year 1 = $18,000, Year 2 = $15,000 D: Initial Investment = -$13,000, Year 1 = $22,000, Year 2 = $12,000 E: Initial Investment = -$20,000, Year 1 =...

Consider the following probability distribution of returns estimated for Projects B, C and D. Construct an...

Consider the following probability distribution of returns estimated for Projects B, C and D. Construct an equal-weighted (50/50) portfolio of Investments B and D. State Probability B C D Very poor 0.1 25% -25% 15% Poor 0.2 15% -5% 10% Average 0.4 10% 15% 0% Good 0.2 0% 35% 25% Very good 0.1 -10% 55% 35% The expected rate of return of the portfolio is 10.25. What is the standard deviation?

The following table of values gives a company's annual profits in millions of dollars. Rescale the...

The following table of values gives a company's annual profits in millions of dollars. Rescale the data so that the year 2005 corresponds to x=1 . Year 2005 2006 2007 2008 2009 2010 Profits (in millions of dollars) 51.8 63.4 66.3 65.8 62.1 63.8 Use the power regression model to predict the company's profits in 2012. a) $70.2 million b) $68.6 million c) $71.5 million d) $67.7 million e) $66.6 million f) None of the above

Consider the cross: A/a; b/b; C/c; D/d; E/e x A/a; B/b; c/c; D/d; e/e a) what...

Consider the cross: A/a; b/b; C/c; D/d; E/e x A/a; B/b; c/c; D/d; e/e a) what proportion of the progeny will phenotypically resemble the first parent? b) what proportion of the progeny will genotypically resemble neither parent?

Using the data in the table, calculate the rate constant of this reaction. A+B⟶C+DA+B⟶C+D Trial [?]...

Using the data in the table, calculate the rate constant of this reaction. A+B⟶C+DA+B⟶C+D Trial [?] (?)[A] (M) [?] (?)[B] (M) Rate (M/s) 1 0.4000.400 0.2000.200 0.01600.0160 2 0.4000.400 0.5400.540 0.1170.117 3 0.4800.480 0.2000.200 0.01920.0192 ?=k= Units

For each of the following simplicial complexes ,X = {[a], [b], [c], [d], [a, b], [c,...

For each of the following simplicial complexes ,X = {[a], [b], [c], [d], [a, b], [c, d]}, and X = {[a], [b], [c], [d], [e], [a, b], [b, c], [c, d], [a, d], [a, c], [a, e], [b, e], [a, b, c]},give a basis for each non-zero Hj(X).

Consider the following propositional formula: (((A ^ B) -> C) ^ ((A ^ C) -> D))...

Consider the following propositional formula: (((A ^ B) -> C) ^ ((A ^ C) -> D)) -> ((A ^ B) -> D) Perform the following tasks for this formula: Convert this formula into CNF form and write a numbered list of all clauses obtained from this formula.

Katerah City maintains the following funds: a) General b) Special revenue c) Capital projects d) Debt...

Katerah City maintains the following funds: a) General b) Special revenue c) Capital projects d) Debt service e) Enterprise f) Investment trust g) Permanent h) Agency For each of the following transactions, indicate which fund would most likely be used to report the transaction (each fund will be used once): 1. The city collects $1 million of taxes for an independent fire district located within the city. 2. The city spends $1.2 million on street maintenance using the proceeds of...

Given the following table of grades: Grades A B C D F Totals Males 17 8...

Given the following table of grades: Grades A B C D F Totals Males 17 8 14 11 3 53 Females 12 11 13 6 5 47 Totals 29 19 27 17 8 100 a. What is the probability that a randomly selected student got an A or B? b. What is the probability that if a student was female that they got a passing grade? c. What is the probability of a female student given that they got a...

Question