Question: The following table shows the timetable for the two projects for projects A and B and the installation of an existing project in Year 0.

The following table shows the timetable for the two projects for projects A and B and the installation of an existing project in Year 0. Answer the following questions: Which of the two projects will you accept, the two projects will be rejected based on the assumption that you want to recover your money within 3 years of the life of the project? Why? (2 tag) B. Calculate the profitability index for the two projects? The two projects are based on the profitability index If the two projects are mutually exclusive, and why? (3 mark

The following table shows the timetable for the two projects for projects

YEAR project A ( Cash flow) -11,000$ 0 project B( Cash flow) -26,000$ 1 4000 2000 2 4000 8000 3 4000 14,000 4 4000 20,000 5 4000 26,000 6 4000 32,000 7 4000 8 26,000 32,000 4000 YEAR project A ( Cash flow) -11,000$ 0 project B( Cash flow) -26,000$ 1 4000 2000 2 4000 8000 3 4000 14,000 4 4000 20,000 5 4000 26,000 6 4000 32,000 7 4000 8 26,000 32,000 4000

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!