Two projects have the following projected cash flows:
-Refer to the information above. Assume that the appropriate discount rate for both
projects is 10%. Calculate the profitability index for each project. Which, if either,
project should be undertaken based on your calculations? If the projects are mutually
exclusive, can you choose between them using this method? Why or why not?

Question

Two projects have the following projected cash flows: 
-Refer to the information above. Assume that the appropriate discount rate for both
projects is 10%. Calculate the profitability index for each project. Which, if either,
project should be undertaken based on your calculations? If the projects are mutually
exclusive, can you choose between them using this method? Why or why not?

Quizplus · Accepted Answer

The Answer of Two projects have the following projected cash flows: 
-Refer to the information above. Assume that the appropriate discount rate for both
projects is 10%. Calculate the profitability index for each project. Which, if either,
project should be undertaken based on your calculations? If the projects are mutually
exclusive, can you choose between them using this method? Why or why not?

Two Projects Have the Following Projected Cash Flows