Question: Information on three potential projects is given below: Required: 1. Compute the project profitability index for each project. 2. Rank the projects in terms of

Information on three potential projects is given below:

Project A В Investment required.... Present value of cash inflows.. Net present value.... $(170,000) 229,500 $ 59,500 $(190,000) 294,500 $ 104,500 $(220,000) 330,000 $ 10,000

Required:
1. Compute the project profitability index for each project.
2. Rank the projects in terms of preference.

Project A Investment required.... Present value of cash inflows.. Net present value.... $(170,000) 229,500 $ 59,500 $(190,000) 294,500 $ 104,500 $(220,000) 330,000 $ 10,000

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