medium · Principles of Finance capital-budgeting
A firm is considering a project with an initial cost of 1,000,000. It is expected to generate free cash flows of 300,000 per year for 5 years.
If the cost of capital is 10%, what is the project's Profitability Index (PI)?
- 1.137
- 1.210
- 1.500
- 0.137
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