PI=(NPV+ initial investment)÷ initial investment
1.24375=(195000+Initial investment)÷initial investment
1.24375×initial investment=195000+initial investment
1.24375×initial investment−initial investment=195000
initial investment(1.24374−1)=195000/0.24373=800065.6
so option [2] R800 000 appears to be the correct answer as it is close to the calculated value.
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