Question: Shamo Ventures has identified five projects with positive Net Present Value but can raise an amount of GHS150,000 in loans from the International Financial Market

  1. Shamo Ventures has identified five projects with positive Net Present Value but can raise an amount of GHS150,000 in loans from the International Financial Market at a cost to finance these projects in the coming year, 2023. Below are the Net Present Values of the projects:

Project

A

B

C

D

E

NPV (GHS000)

500

400

350

200

280

Investment @ time 0 (GHS000)

90

120

60

40

45

Required:

Advise the company which project(s) to accept if the projects are:

  1. independent and divisible

ii) independent and indivisible

iii) mutually exclusive

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