Rank the projects in order of their desirability

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Problem - Wellington Corporation estimates that it will have $500,000 available for capital investments next year. Half of this will be reserved for emergency projects and half will be invested in the most desirable projects from the following list.  None of the investments has residual value.

Project Number

Added Investment

Expected After-Tax Cash Inflow

Estimated Life of Project

1

$100,000

$25,000

6 years

2

$100,000

$30,000

4 years

3

$40,000

$5,000

15 years

4

$20,000

$10,000

2 years

5

$50,000

$12,500

3 years

Required: Rank the projects in order of their desirability.

Reference no: EM131779982

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