The Black Horse is currently considering a project that will produce cash inflows of $12,000 a year for three years followed by $6,500 in year four. The cost of the project is $38,000. What is the profitability index if the discount rate is 7 percent?
A) 0.96
B) 0.99
C) 1.04
D) 1.09
E) 1.12

Question

Quizplus · Accepted Answer

The Answer of The Black Horse is currently considering a project that will produce cash inflows of $12,000 a year for three years followed by $6,500 in year four. The cost of the project is $38,000. What is the profitability index if the discount rate is 7 percent?
A) 0.96
B) 0.99
C) 1.04
D) 1.09
E) 1.12

The Black Horse Is Currently Considering a Project That Will