Given the Following Data $$\begin{array} {| l | l| } \hline \text { Life of the Project } & \text { 10years } \\\hline\end{array}$$

question 35

Multiple Choice

Given the following data:
$\begin{array}{|l|r|}\hline \text { Present Investment Required } & \$ 12,000 \\\hline \text { Net Present Value } & \$ 430 \\\hline \text { Annual cost Savings } & \$ ? \\\hline \text { Discount Rate } & 12 \% \\\hline\end{array}$
$$\begin{array} {| l | l| } \hline \text { Life of the Project } & \text { 10years } \\\hline\end{array}$$
Based on the data given,what would be the profitability index? (Ignore income taxes in this problem.)

• A) 3.05%.
• B) 35.8%.
• C) 3.58%.
• D) Cannot be determined from the information given.

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