(Ignore income taxes in this problem.) Your Corporation is considering the following three investment projects:MInitial investment$46,000$75,000$95,000Present value of cash flows$49,850$80,250$102,500What it the profitability index for investment project O?O.079O .927.065.073

Profitability Index = Present Value of cash flows / Initial investment =$102,500 / $95,000 =1.079

Answered: What it the profitability index for…

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What it the profitability index for investment project O?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter12: Capital Budgeting: Decision Criteria

Section: Chapter Questions

Problem 7P: Your division is considering two investment projects, each of which requires an up-front expenditure...

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