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Author Question: The project cash flows and Profitability Indexes for Projects A and B are provided in the table ... (Read 57 times)

OSWALD

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Question 1

The project cash flows and NPVs for Projects A and B are provided in the table below. Which project has a higher profitability index?

Project AProject B
Year 0-$1,900-$2,000
Year 1$2,500$1,550
Year 2$1,500$1,900
NPV$1,408.12$784.50

◦ Project A
◦ Project B
◦ The two projects have the same Profitability Index.

Question 2

The project cash flows and Profitability Indexes for Projects A and B are provided in the table below. If the two projects are mutually exclusive, which project should you select?

Project AProject B
Year 0-$1,900-$2,000
Year 1$2,500$1,550
Year 2$1,500$1,900
PI1.74111.3923

◦ Project A
◦ Project B
◦ Either Project A or Project B
◦ Both Projects


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Marked as best answer by OSWALD on Apr 25, 2021

ilianabrrr

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OSWALD

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Reply 2 on: Apr 25, 2021
YES! Correct, THANKS for helping me on my review


aruss1303

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Reply 3 on: Yesterday
Gracias!

 

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