Profitability index of the investment

Assignment Help Finance Basics
Reference no: EM131097851

You are offered an investment with returns of $ 1,215 in year 1, $3,338 in year 2, and $5,442 in year 3. The investment will cost you $5,971 today. If the appropriate Cost of Capital (quoted interest rate) is 11.3 %, what is the Profitability Index of the investment? Enter your answer to the nearest .01. Do not use the $ sign or commas in your answer. If the NPV is negative, use the - sign.

Reference no: EM131097851

Questions Cloud

Compare and contrast different theories of virtue : Define virtue and virtue ethics. Compare and contrast different theories of virtue. Select and discuss a virtue ethics thinker you closely align yourself with.
Implementation of new technologies : Explain the importance of sustainability in the selection and implementation of new technologies. Provide examples of sustainable technologies.
How will you measure progress and effectiveness of the plans : Develop a case study or, preferably, refer to one that is known to you but change names and any specific identifying information that involves a person with an addiction.
Participants in the wall street code : 1. List all of the participants in the Wall Street Code documentary that seemed to have a negative opinion of high frequency trading.
Profitability index of the investment : What is the Profitability Index of the investment? Enter your answer to the nearest .01. Do not use the $ sign or commas in your answer. If the NPV is negative, use the - sign.
Which bank would you go to for a new loan : Far side Corporation is expected to pay the following dividends over the next four years:  $11, $8, $5 and $2. Afterward, the Company pledges to maintain a constant 5 percent growth rate in dividends forever. If the required return on the stock is 12..
Current zero coupon yield curve : 2. The current zero coupon yield curve for risk free bonds is as follows:
Employment of different types of power : Describe leader power, follower motivation, and the aspects of effective followership - Provide an overview of influence and the major process and content motivational theories
Determining the revenue for a period : A company is in need or revenue for a period of 26 weeks. They elect to sell 10,000 T-Bills that will mature to $1000 after the 26 weeks. If the company wants to pay a simple interest rate of 5.2% on the T-Bills,

Reviews

Write a Review

Finance Basics Questions & Answers

  Exman company performed a study of its billing and

exman company performed a study of its billing and collection procedures and found that an average of 8 days elapses

  A companys beta is -15 if the overall stock market

a companys beta is -1.5. if the overall stock market decreases by 5 what is the expected change in the firms stock

  Quarterly payments effect the value/price of a bond

How do you semi annual and quarterly payments effect the value/price of a bond? Use a numeric example to explain.

  The recovery rate for each in the event of default is 50

suppose xyz corporation has two bonds paying semiannually according to the following tableremainingcoupont-bill

  A stock has a 50 chance of producing a 20 return a 25

a stock has a 50 chance of producing a 20 return a 25 chance of producing a 10 return and a 25 chance of producing a

  Mississippi river shipyards is considering the replacement

Mississippi River Shipyards is considering the replacement

  What is the constant amount he needs to save in the bank

sandy is planing his retirement.the rate of interest that he can lend and borrow at the bank is 6 percent. he currently

  Find the intrinsic value of a common stock

Find the intrinsic value of a common stock that last paid a quarterly dividend of $.03 if there is no expected increament in dividends and your required rate of return is 10 percent.

  Find the amount of interest in her 133rd payment

Ellen has a thirty year mortgage with level payments. The amount of principal in her 82nd payment is $259.34, and the amount of principal in her 56th payment is $230.19. Find the amount of interest in her 133rd payment.

  In december 2007 dukrsquos board announced that it planned

duke energy corporation duk is a utility-based holding company involved in providing natural gas and electricity. the

  You bought one of rocky mountain manufacturing cos 9

you bought one of rocky mountain manufacturing co.s 9 percent coupon bonds one year ago for 1054.80. these bonds make

  Describe the diversifi cation potential of two assets

Describe the diversifi cation potential of two assets with a 0.8 correlation. What's the potential if the correlation is 0.8?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd