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Home / Questions / Problem 8 13 Calculating Profitability Index LO 6 Consider the following cash flows Year Cash Flow

Problem 8 13 Calculating Profitability Index LO 6 Consider the following cash flows Year Cash Flow

Problem 8-13 Calculating Profitability Index [LO 6]

Consider the following cash flows:
Year Cash Flow
0 $-29,800
1 13,900
2 15,000
3 11,400
 
Requirement 1:

What is the profitability index for the above set of cash flows if the relevant discount rate is 9 percent? (Do not round intermediate calculations. Round your answer to 3 decimal places (e.g., 32.161).)

Profitability index __________________  
Requirement 2:

What is the profitability index if the discount rate is 14 percent? (Do not round intermediate calculations. Round your answer to 3 decimal places (e.g., 32.161).)

Profitability index ______________  
Requirement 3:

What is the profitability index if the discount rate is 21 percent? (Do not round intermediate calculations. Round your answer to 3 decimal places (e.g., 32.161).)

Profitability index ________________  
Asked 

Aug 22 2020 View more View Less

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