Answer:
Opportunity 2
Explanation:
Calculation to determine Which investment yields a higher rate of return
Based on the information given OPPORTUNITY 2 investment yields a HIGHER rate of return reason because the PRESENT VALUE INDEX is 1.968 calculated as :
Rate of return=$14,232/$7,232
Rate of return= 1.968
Which is HIGHER than the present value index of both opportunity 1 and opportunity 3.