Question

Year Cash Flows 0 -67334 1 30908 2 31393 3 31036 What is the profitability index for the set of cash flows if the relevant discount rate is 10 percent? (Do not round intermediate calculations and round your final answer to 3 decimal places. (e.g., 32.161))

Answer #1

PV of future cash flows is calculated using a financial calculator by inputting the below:

- Press the CF button.
- CF0= -$67,334. . It is entered with a negative sign since it is a cash outflow.
- Cash flow for each year should be entered.
- Press Enter and down arrow after inputting each cash flow.
- After entering the last cash flow cash flow, press the NPV button and enter the discount rate of 10%.
- Press enter after that. Press the down arrow and CPT buttons to get the net present value.

The present value of cash flows is $10,026.62.

Profitability Index= $10,026.62/$67,334= 0.15.

Therefore, the profitability index is
**0.149.**

In case of any query, kindly comment on the solution.

Year
Cash Flows
0
-17189
1
11331
2
9978
3
6764
What is the profitability index for the set of cash flows if the
relevant discount rate is 9 percent? (Do not round
intermediate calculations and round your final answer to 3 decimal
places. (e.g., 32.161))

Year Cash Flows 0 -18265 1 11583 2 9838 3 6164 What is the
profitability index for the set of cash flows if the relevant
discount rate is 9 percent? (Do not round intermediate calculations
and round your final answer to 3 decimal places. (e.g.,
32.161))

Year
Cash Flow
0
–$
18,500
1
10,800
2
9,700
3
6,200
What is the profitability index for the set of cash flows if the
relevant discount rate is 9 percent? (Do not round
intermediate calculations and round your answer to 3 decimal
places, e.g., 32.161.)
Profitability index
What is the profitability index for the set of cash flows if the
relevant discount rate is 14 percent? (Do not round
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Consider the following cash flows:
Year
Cash Flow
0
–$
34,000
1
15,100
2
16,600
3
12,500
a.
What is the NPV at a discount rate of zero percent? (Do
not round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.)
b.
What is the NPV at a discount rate of 8 percent? (Do
not round intermediate calculations and round your answer to 2
decimal places, e.g., 32.16.)
c.
What is the NPV at a discount...

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if the relevant discount rate is 22...

What is the profitability index for the following set of cash
flows if the relevant discount rate is 10 percent? What if the
discount rate is 15 percent? If it is 22 percent? Year Cash
Flow
0 -16,700
1-9,700
2 -7,800
3 - 4,300

A project has the following cash flows:
Year Cash Flow
0 –$ 16,600
1 7,300
2 8,600
3 7,100
What is the NPV at a discount rate of zero percent? (Do not
round intermediate calculations and round your answer to the
nearest whole number, e.g., 32.)
What is the NPV at a discount rate of 12 percent? (Do not round
intermediate calculations and round your answer to 2 decimal
places, e.g., 32.16.)
What is the NPV at a discount rate...

Year Cash Flow
0 −$9,100
1 5,300
2 5,700
3 4,900
a. What is the profitability index for the cash flows if the
relevant discount rate is 8 percent?
b. What is the profitability index for the cash flows if the
relevant discount rate is 19 percent?
c. What is the profitability index for the cash flows if the
relevant discount rate is 23 percent?
Please be very specific in where you found each number

A project has the following cash flows: Year Cash Flow 0 –$
15,400 1 6,100 2 7,400 3 5,900 What is the NPV at a discount rate
of zero percent? (Do not round intermediate calculations and round
your answer to the nearest whole number, e.g., 32.) NPV $ 4,000
What is the NPV at a discount rate of 8 percent? (Do not round
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Year Cash Flow
0 −$7,900
1 2,600
2 3,500
3 2,600
a. What is the profitability index for the cash flows if the
relevant discount rate is 8 percent?
Multiple Choice
0.974
0.993
0.899
0.917
0.946
b. What is the profitability index for the cash flows if the
relevant discount rate is 19 percent?
Multiple Choice
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0.824
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