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Compute the PI Statistic for Project X and Note Whether

Question 65

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Compute the PI statistic for Project X and note whether the firm should accept or reject the project with the cash flows shown as follows if the appropriate cost of capital is 10 percent.
Time: 012345Cash flow:2507501007550\begin{array}{l}\begin{array} {| l | l | l | l | l | l | l |}\hline\text {Time: }&0&1&2&3&4&5\\\hline\text {Cash flow:}&-250&75&0&100&75&50\\\hline\end{array}\end{array}


A) ?0.0977 percent, reject
B) ?9.77 percent, reject
C) ?24.41 percent, reject
D) 24.41 percent, accept

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