A Project with an Initial Investment of $70,000 and a Profitability

question 134

Multiple Choice

A project with an initial investment of $70,000 and a profitability index of 1.239 also has an internal rate of return of 12%. The present value of net cash flows is

• A) $78,400.
• B) $86,730.
• C) $56,497.
• D) $70,000.

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Definitions:

Organize

The process of structuring or arranging resources and tasks to achieve a specific objective efficiently.

Capital Balances

The amount of equity ownership a partner has in a partnership or an investor has in a company.

Noncash Assets

Assets that are not in the form of cash or currency, including tangible assets like property, plant, and equipment, and intangible assets like patents and copyrights.

Distribution

The process of making a product or service available for the consumer or business user.