Question: 3. A Project X initially costing $ 250,000 generates following cash flows. If the cost of capital is 12%, calculate a) Net Present Value b)

3. A Project X initially costing $ 250,000 generates following cash flows. If the cost of capital is 12%, calculate a) Net Present Value b) Profitability Index of the project.

Year

Cash flow

90,000

80,000

III

70,000

60,000

50,000

Whether the project should be accepted or not?

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