Question: Montana Grill has computed the net present value for capital expenditures for the Billings and Great Falls locations using the net present value method. Relevant

Montana Grill has computed the net present value for capital expenditures for the Billings and Great Falls locations using the net present value method. Relevant data related to the computation are as follows:

.................................................Billings...........................Great falls

Total present value of net cash flow.......$882,000........................$1,050,000

Amount to be invested........................900,000............................750,000

a. Determine the present value index for each proposal. Round to two decimal places.

b. If Montana Grill can fund only one location, which location should be funded?

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