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Homework answers / question archive / Dawntreader Landscaping is considering purchasing $175,000 of new lawn equipment and they anticipate the additional equipment will result in cash flows as below
Dawntreader Landscaping is considering purchasing $175,000 of new lawn equipment and they anticipate the additional equipment will result in cash flows as below. Their weighted average cost of capital is 8.75%.
Year | Cash flow |
1 | 36,000 |
2 | 41,000 |
3 | 45,000 |
4 | 53,000 |
5 | 58,000 |
The profitability index for the project is:
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