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A Project Requires a Net Investment of $450,000

Question 4

Multiple Choice

A project requires a net investment of $450,000. It has a profitability index of 1.25 based on the firm's 12% cost of capital. Determine the net present value of the project.


A) $112,500
B) $562,500
C) $1,012,500
D) $140,625

Correct Answer:

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