Question

In: Finance

Calculating Profitability Index What is the profitability index for the following set of cash flows if...

Calculating Profitability Index What is the profitability index for the following set of cash flows if the relevant discount rate is 10 percent? What if the discount rate is 15 percent? If it is 22 percent?

Year Cash Flow
0 −$29,500
1 16,900
2 13,600
3 8,300

Solutions

Expert Solution


Related Solutions

7.) What is the profitability index for the following set of cash flows if the relevant...
7.) What is the profitability index for the following set of cash flows if the relevant discount rate is 10 percent? What if the discount rate is 15 percent? If it is 22 percent? Year Cash Flow 0 ?$15,300 1       9,400 2       7,600 3       4,300
What is the profitability index for an investment with the following cash flows given a 9%...
What is the profitability index for an investment with the following cash flows given a 9% required return? Year      Cash flow 0 -21,000 1 7,400 2 9,800 3 8,900 0.98 0.96 1.00 1.04
What is the profitability index for an investment with the following cash flows given a 8...
What is the profitability index for an investment with the following cash flows given a 8 percent required return?        Year         Cash Flow 0 $-20,500    1 $7,100    2 $9,700    3 $8,500    1.06 1.07 1.04 1.00 1.01
What is the profitability index of a project that costs $8,000 and provides cash flows of...
What is the profitability index of a project that costs $8,000 and provides cash flows of $2,100 in years 1 and 2 and $4,100 in years 3 and 4? The discount rate is 10%. (Do not round intermediate calculations. Round your answer to 4 decimal places.)
Calculate the profitability index (PI) for the following cash flows if the relevant discount rate is...
Calculate the profitability index (PI) for the following cash flows if the relevant discount rate is 10% Year Cash Flow 0 -15,300 1 9,400 2 7,600 3 4,300
Find the profitability index of a project with the following cash flows using a discount rate...
Find the profitability index of a project with the following cash flows using a discount rate of 2%: Period 0: -1000 Period 1: 707 Period 2: 398 Period 3: 291 Enter your answer in a decimal and round to the hundredths place.
1. Based on the profitability index rule, should a project with the following cash flows be...
1. Based on the profitability index rule, should a project with the following cash flows be accepted if the discount rate is 12 percent? Why or why not? Year Year Cash Flow 0 $-26,200 1 $11,800 2 $0 3 $24,900
a. What is the profitability index for the cash flows if the relevant discount rate is 10 percent?
Year 0 Cash Flow −$7,400Year 1 Cash Flow $2,700Year 2 Cash Flow $5,400Year 3 Cash Flow $5,000a. What is the profitability index for the cash flows if the relevant discount rate is 10 percent?b. What is the profitability index for the cash flows if the relevant discount rate is 17 percent?c. What is the profitability index for the cash flows if the relevant discount rate is 22 percent?
What is profitability Index? Given the discount rates and the future cash flows of each project,...
What is profitability Index? Given the discount rates and the future cash flows of each project, which project should they accept using Profitability Index? Cash Flows Project A Project B Project C Project D Year Zero - $ 1,500,000 - $ 1,500,000 - $ 2,000,000 - $ 2,000,000 Year One $ 350,000 $ 400,000 $ 700,000 $ 200,000 Year Two $ 350,000 $ 400,000 $ 600,000 $ 400,000 Year Three $ 350,000 $ 400,000 $ 500,000 $ 600,000 Year Four...
True or False: Profitability index is the PV of future cash flows divided by the initial...
True or False: Profitability index is the PV of future cash flows divided by the initial investment. A result of greater than .9 is desired.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT