Peter is considering a project with an initial cost of $42,000 and annual cash inflows of $9,100 a year for six years. What discount rate, when applied to this project, will produce a profitability index of 1.0?
A) 7.00%
B) 7.65%
C) 7.88%
D) 8.05%
E) 8.11%

Question

Quizplus · Accepted Answer

The Answer of Peter is considering a project with an initial cost of $42,000 and annual cash inflows of $9,100 a year for six years. What discount rate, when applied to this project, will produce a profitability index of 1.0?
A) 7.00%
B) 7.65%
C) 7.88%
D) 8.05%
E) 8.11%

Peter Is Considering a Project with an Initial Cost of $42,000