Question: Profitability Index versus NPV. Consider these two projects: a. Which project has the higher NPV if the discount rate is 10 percent? b. Which has

Profitability Index versus NPV. Consider these two projects:

a. Which project has the higher NPV if the discount rate is 10 percent?
b. Which has the higher profitability index?
c. Which project is most attractive to a firm that can raise an unlimited amount of funds to pay for its investment projects? Which project is most attractive to a firm that is limited in the funds it canraise?

Co (S36) 50 C1 S20 25 C2 S20 C3 S20 25 Project

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