Question: EV Hyper Chargers is considering a project with the following cash flows: Year O Year 1 Year 2 Year 3 Year 4 -$133 million

EV Hyper Chargers is considering a project with the following cash flows:

EV Hyper Chargers is considering a project with the following cash flows: Year O Year 1 Year 2 Year 3 Year 4 -$133 million $30 million $40 million $55 million $75 million Calculate the Profitability Index (PI) of this project and pick a suitable recommendation. Assume a WACC of 13%. Pl=-1.0676 < 0, so reject PI 0.9367 < 1, so reject OPI = 0.9367 > 0, so accept PI 1.0676 > 0, so accept = PI 1.0676> 1, so accept = I

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!