Question: 14. Look again at projects D and E in Section 5.3 . Assume that the projects are mutually exclusive and that the opportunity cost of

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

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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