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QUESTION 1 The finance manager of Bermuda Corporation is deciding on which project to choose as their future investment. Given is the future cash...
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Subject :Principle of Finance Chapter 9: Capital Investment Decision Analysis ICorrection for the image at below .

Question 1

a) i) NPV ( Net present value)

ii) Payback period using discounting method

iii) Profitability indexWhatsApp Image 2020-09-09 at 10.50.32 PM (1).jpeg

WhatsApp Image 2020-09-09 at 10.50.32 PM (1).jpeg
QUESTION 1
The finance manager of Bermuda Corporation is deciding on which project to choose as
their future investment. Given is the future cash flow of both the project.
Year
Project A
Project B
0
150,000
180.000
40.000
35,000
35,000
54,000
27.000
15.000
30.000
30.000
5
39.000
24,000
Based on the information given,
a) Calculate the following, given the discount rate is 15%
i. NPV
ii. Payback period using discou
iii. nting method
iv. Profitability index
b) How the decision making process will be affected if the projects are
i. Independent
ii. Mutually exclusive

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