Question: 5 . Assuming a machine has the following estimated series of cashflows: Year One: 6 , 0 0 0 ; Year Two: 4 , 0

5. Assuming a machine has the following estimated series of cashflows: Year One: 6,000; Year Two: 4,000; Year Three: 3,000; Year Four: 2,000. The capital outlay is 9,000 and the discount rate on the project is 10%. Would you purchase this machine? Why or why not?
6. Based on your answer to #5, what's the Profitability Index ratio and what does "it" mean?
7. The following are cashflows for a new AI program:
Year Cashflow
01,200
1780
2190
3390
Using the trial and errors method of calculating IRR, is the project acceptable if the hurdle rate is 14%
8. If want your stock portfolio to grow based on a rate-of-return of 8% for 10 years, and you want the account to have $150,000, how much should you invest today?

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