Question: Question 14 (3 points) Listen You are evaluating a 4-year project, and its cash flows are -65000, 24000, 13000, 28000, 18000 for years 0

Question 14 (3 points) Listen You are evaluating a 4-year project, and

Question 14 (3 points) Listen You are evaluating a 4-year project, and its cash flows are -65000, 24000, 13000, 28000, 18000 for years 0 to 4, respectively. If the cost of capital for the project is 9.4 percent, what is the project's profitability index? 0.61 0.77 0.9 1.03 1.15 1.32

Step by Step Solution

★★★★★

3.37 Rating (163 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Profitability index Present value of cash inflows Initial cash outflow 6676... View full answer

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 Accounting Questions!

If the cost of capital is 9 percent and an investment costs $56,000, should you make this investment if the estimated cash flows are $5,000 for years 1 through 3, $10,000 for years 4 through 6, and...

You are evaluating a project that will require an investment of $10 million that will be depreciated over a period of 7 years. You are concerned that the corporate tax rate will increase during the...

The cost of capital for a firm is 10 percent. The firm has two possible investments with the following cash inflows: a. Each investment costs $480. What investment(s) should the firm make according...

1) A project has a net present value of zero. Given this information: A) the project has a zero percent rate of return. B) the project requires no initial cash investment. C) the project has no cash...

I need assistance in completing the open ended portion that could be found on the last page of the pdf file. Part A most importantly is what I need assistance with, the data that needs to be...

Here are the 40 Questions. Have a total of 1:25 mins Question 1 (3 points) 1 A typical loan arrangement requires the same monthly payment at the end of each month for a certain period. This type of...

1. Calculate the cost of each capital component, after-tax cost of debt, cost of preferred, and cost of equity with the DCF method and CAPM method. 2. What do you estimate the company?s WACC? Please...

Dear Friends, I need the solution by today 11.00 PM. Its really important. I dont have lot of funds. I can only pay $10. Max Harvard Business School 9-292-140 June 12, 1992 Arundel Partners: The...

K (Preparing common-size financial statements) As the newest hire to the financial analysis group at Patterson Printing Company, you have been asked to perform a basis financial analysis of the...

I am having trouble with the 2015 and 2016 statements balancing on the FSAP. Could you take a look at it and tell what is wrong and correct it? Financial Statement Analysis Package (FSAP) A Comment...

Financial assets usually cost nothing to store, however, the very purpose of e.g. shares to pay dividends. If you lend a share, the dividend goes to the holder of the share at the time of the...

J.A. Appliance Company has supplied you with the following data regarding working capital and sales for the years 2009, 2008, and 2007. Required a. Compute the sales to working capital ratio for each...

My LinkedIn headline is currently "Intermediate Associate Analyst at Citi". I am currently working on my leadership MBA at Jack Welch Management Institute and my current job duties include: Support...

A bus starts from nest and moves with a constant acceleraduan 4 Sms. At the same time, a car travelling w uth a consfante velocity 16 ms Overtakes the bus. After, bWhen uch and at distance will the...

What is the Securities and Exchange Commission (SEC) Staff guidance on the following question? May a registrant or the auditor of its financial statements assume the immateriality of items that fall...

Volume Total Price Price per Case 550,000 equivalent cases a $ 4,785,000 $ 8.70 1,100,000 8,470,000 7.70 1,650,000 11,385,000 6.90 Amazon Beverages produces and bottles a line of soft drinks using...

You will need to research various brainstorming techniques. Although brainstorming is typically performed in group sessions, you will be applying the same techniques to analyze your problem. Select a...

Take Example 1.3.3 with the same numbers: 89 degrees at t = 0, 85 degrees at t= 1, and ambient temperature of 22 degrees. Suppose these temperatures were measured with precision of +0.5 degrees....

Identify the characteristics of a typical unstructured interview. (Check all that apply.) Multiple select question. It is often formal in structure. Its questions are based on job analysis, and the...

What is a replacement chain? When and how should replacement chains be used in capital budgeting?

a. How would a firms decision to pay out a higher percentage of its earnings as dividends affect each of the following? (1) The value of its long-term warrants (2) The likelihood that its convertible...

What is the implied nominal interest rate on a Treasury bond ($100,000) futures contract that settled at 10016.0 (or 100-160)? If interest rates increased by 1%, what would be the contracts new value?

A $1000, 6.5% coupon bond issued by Bell Canada matures on October 15, 2029. What was its flat price on June 11, 2010 if its yield to maturity was 4.75% compounded semiannually?

Calculate the purchase price (flat) of each of the $1000 face value bonds

Each of the bond issues has a sinking fund requirement for retiring the entire principal amount of the issue on its maturity date. The coupon rates and rates of return on the sinking fund investments...