Question: Assume you have two mutually exclusive projects A&B. Each project costs $15 million with the following cash flows: Based upon using the profitability index and
Assume you have two mutually exclusive projects A&B. Each project costs $15 million with the following cash flows: Based upon using the profitability index and a cost of capital of 10%, which project would you chose if you only had $15 million to spend : Year Project A Project B $8 million $20 million 12 $10 million $10 million 13 $20 million $ 5 million O A. Project A O B. Project B OC. Neither O D. Both; the heck with what Corporate says the budget is
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