medium · Principles of Finance time-value-of-money
A company is considering a project that requires an initial investment of 5.0M and is expected to generate 1.5M in annual FCFF for 5 years. The WACC is 12%.
If the company uses the Profitability Index (PI) as a decision criterion, what is the result?
- 0.92
- 1.20
- 1.50
- 1.08
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