Question: P 1 2 - 2 8 Capital rationing: NPV approach A firm with a 1 3 % cost of capital must select the optimal group
P Capital rationing: NPV approach A firm with a cost of capital must select the optimal group of projects from those shown in the
following table, given its capital budget of $ million.
Calculate the present value of cash inflows associated with each project.
Select the optimal group of projects, keeping in mind that unused funds are costly
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