What is the investment profitability index

Assignment Help Finance Basics
Reference no: EM131387813

ABC Inc. is considering an investment of $1,750 million with after-tax cash inflows of $332 million per year for six years and an additional after-tax salvage value of 87 million in Year 6. The required rate of return is 8%. What is the investment's Profitability Index (PI)?

Reference no: EM131387813

Questions Cloud

Is the contractual modification binding : After the contract is consummated and signed, Dickison orally requests that International deliver the widgets within thirty days rather than sixty days. International agrees. Is the contractual modification binding?
Describe the history of the us health care system : Describe the history of the U.S. health care system. Include at least three of the revolutionary factors (e.g., teacher's union in Dallas, Texas; the American Medical Association; Civil War, and the First Marine Hospital, etc.). Chapter two in our..
What would be the result in the given : A dispute arises concerning the workmanship of the parts, and Hicks wishes the case to be arbitrated in San Francisco. What would be the result?
Anne purchased a bond for a museum valued : Anne purchased a bond for a museum valued at $8000 for $2400. If the bond pays 5.5% annual interest compounded monthly, how long must she hold it until it reaches its full face value?
What is the investment profitability index : ABC Inc. is considering an investment of $1,750 million with after-tax cash inflows of $332 million per year for six years and an additional after-tax salvage value of 87 million in Year 6. The required rate of return is 8%. What is the investment..
What is the cost associated with this truck that is relevant : The manager of a small business is considering lowering the price on his main product for the coming year. If there is any increase in the company's current sales, the manager would have to acquire another delivery truck. Assume that the manager woul..
Explain any reactions you had to the interview : Describe any reactions you had to the interview. Describe your reflection on where you see your career going within the framework of higher-education leadership.
After-tax salvage value : ABC Company purchased a new machinery 4 years ago for $50,538. Today, it is selling this equipment for $20,298. What is the after-tax salvage value if the tax rate is 22 percent?
If the us electronics form contained the given provisions : Explain how the result in might change if the U.S. Electronics form contained the given provisions:- ‘‘The seller's terms govern this agreement-this acknowledgment merely constitutes a counteroffer.''

Reviews

Write a Review

Finance Basics Questions & Answers

  Analyzing financial techniques

What tools or techniques would you use in examine business strategies, financial reporting & disclosure policies, financial performance, forecasts & fundamental values?

  How many patients must be seen each day

how many patients must be seen each day, assuming a 365-day operation, to reach the break-even point?

  Balance the alignment of organizational goals

How can you balance the alignment of organizational goals with compliance of legal requirements when implementing a financial plan?

  What techniques are not appropriate for you use on your trip

What techniques are not appropriate for you use on your trip to Terre Haute to gather information?

  What will happen to profits next year if interest rates fall

If the manager of the First National Bank revises the estimate of the percentage of fixed-rate mortgages that are repaid within a year from 20% to 10%, what will be the revised estimate of the interest-rate risk the bank faces? What will happen to pr..

  What are the features of cost-volume profit

What are the features of cost-volume profit (CVP) analysis and why are managers interested in the break-even analysis point?

  Simple plan versus actual system

How does earned value give a clearer picture of the project schedule and cost status than a simple plan versus actual system? Schedule variance (SV) is in dollars and does not directly represent time. Why is it still useful?

  Explain capital budgeting decisions on borrowable

Explain Capital Budgeting decisions on borrowable of bank loan and what is the most John can consume at t0

  What is role of top management in participative budgeting

What is the role of top management in participative budgeting? Explain why a manager has an incentive to build slack into the budget.

  Creating a spreadsheet track personal business expenses is

creating a spreadsheet track personal business expenses is an excellent use of microsoft excel.nbsp for this exercise

  Describe an industry that you believe is in stage 2

Assess the impact on the U.S. stock market when the Federal Reserve increases the money supply, and whether or not you believe the impact is predictable.

  Explain why the notes to a firmrsquos financial statements

explain why the notes to a firmrsquos financial statements are an integral part of the company.nbsp what kind of

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