Question: Use the PI decision rule to evaluate this project; should it be accepted or rejected? Suppose your firm is considering investing in a project with

Use the PI decision rule to evaluate this project; should it be accepted or rejected?

Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 3 and 3.5 years, respectively.

Time0 Cash Flow S235.000 $65.800 $84.000 $141.000 S122.000 S81.200

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