Present value ratios index Information about four investment proposals is summarized here:
|
Proposal |
Investment Required |
Net Present Value |
|
1 |
$60,000 |
$36,000 |
|
2 |
24,000 |
9,600 |
|
3 |
72,000 |
36,000 |
|
4 |
72,000 |
14,400 |
Required:
Calculate the present value ratio of each proposal and indicate which proposal is the most desirable investment.