Bingo Plc has 1,000 to invest and is considering a number of different projects. The cash outflows and inflows for the projects are as follows: Project A:investment of 500; Year 1 cash inflow of 300; Year 2 cash inflow of 400 Project B:investment of 600; Year 1 cash inflow of 500; Year 2 cash inflow of 800 Project C:investment of

Sep 8, 2023

Bingo Plc has £1,000 to invest and is considering a number of different projects. The cash outflows and inflows for the projects are as follows:

  • Project A:investment of £500; Year 1 cash inflow of £300; Year 2 cash inflow of £400
  • Project B:investment of £600; Year 1 cash inflow of £500; Year 2 cash inflow of £800
  • Project C:investment of £700; Year 1 cash inflow of £400; Year 2 cash inflow of £900

    Assuming a cost of capital of 10%, and that the projects are divisible.

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    Bingo Plc has 1,000 to invest and is considering a number of different projects. The cash outflows and inflows for the projects are as follows: Project A:investment of 500; Year 1 cash inflow of 300; Year 2 cash inflow of 400 Project B:investment of 600; Year 1 cash inflow of 500; Year 2 cash inflow of 800 Project C:investment of
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    What is the maximum possible NPV (rounded to the nearest £10) that Bingo Plc can generate from a £1,000 investment?

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