Question: Look again at projects E and F in Section 5.3. Assume that the projects are mutually exclusive and that the opportunity cost of capital is

Look again at projects E and F in Section 5.3. Assume that the projects are mutually exclusive and that the opportunity cost of capital is 10 percent.

a. Calculate the profitability index for each project.

b. Show how the profitability-index rule can be used to select the superior project.

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