Question: Net Present Value Method, Present Value Index, and Analysis for a service company Continental Railroad Company is evaluating three capital investment proposals by using the


Net Present Value Method, Present Value Index, and Analysis for a service company Continental Railroad Company is evaluating three capital investment proposals by using the net present value method. Relevant data related to the proposals are summarized as follows: Present Value of $1 at Compound Interest 1. Assuming that the desired rate of return is 6%, prepare a net present value analysis for each proposal. Use the present value of $1 table above. If required, use the minus sign to indicate a negative net present value. If required, round to the nearest dollar. 2. Determine a present value index for each proposal. If required, round your answers to two decimal places. 3. The has the largest present value index. Althouph has the largest net present value, it returns less present value per doliar invested than does the as revealed by the present value indexes. The present value index for the is less than 1 , indicating that it does not meet the minimum rate of return standard. 2. Determine a present value index for each proposal. If required, round your answers to two decimal places. 3. Th : argest present value index. Athough has the largest net present value, it retums less present value pel dollar maintenance equipment as revealed by the present value indexes. The present value index for the ramp facilities aimum rate of return standard. computer network
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