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What is the profitability index of the project

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Question - A project is expected to generate new sales of $1.5 million per year with total annual costs of $1.1 million and has initial installed cost of $5 million. The cash flows are expected to continue in perpetuity and the equipment will NOT be depreciated for tax purposes. The tax rate is 40% and the required return is 10%. What is the profitability index of the project?

Reference no: EM133021132

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