In the figure above, item 3 points to the ____.
Definitions:
Profitability Index
A financial tool used to evaluate the desirability of an investment, calculated as the present value of future cash flows divided by the initial investment.
Accepted
Acknowledged or approved, typically in the context of an agreement or transaction.
Discount Rate
The discount rate is the interest rate used in discounted cash flow (DCF) analysis to present value future cash flows and assess the attractiveness of an investment.
Net Present Value
An approach to determining the value of an investment by discounting future cash flows to their present value.
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