Roy's Welding Projects Cash Flows of $13,500,$20,400,and $32,900 for Years

question 4

Multiple Choice

Roy's Welding projects cash flows of $13,500,$20,400,and $32,900 for Years 1 to 3 for a project with an initial cost of $45,000.What is the profitability index given an assigned discount rate of 15 percent?

• A).92
• B).97
• C)1.03
• D)1.08
• E)1.14

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Definitions:

Annual Percentage Rates

The annual rate charged for borrowing or earned through an investment, inclusive of any fees or additional costs associated with the transaction.

Time Lines

Graphical representations used in project management and planning to illustrate the schedule and sequence of tasks or events.

Time Value

The principle that having money now is preferable to receiving the same sum later on, as it has greater earning potential.

Graphic Portrayal

Graphic portrayal involves the visual representation of data or concepts, using charts, graphs, or other graphical tools to illustrate relationships and trends.