The company has a project with a 5-year life, an initial investment of $195,000, and...
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Accounting
The company has a project with a 5-year life, an initial investment of $195,000, and is expected to yield annual cash flows of $56,000. Whathat is the present value index of the project if the required rate of return is set at 10%?
Present value index
=
Total present value of net cash flows
Initial investment
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