Question: Consider the following projects: Cash Flows ( $ ) Project C 0 , C 1 D ( 1 1 , 7 0 0 ) (

Consider the following projects:
Cash Flows ($)
Project C0, C1
D (11,700)(23,400)
E (21,700)(37,975)
Assume that the projects are mutually exclusive and that the opportunity cost of capital is 12%.
a. Calculate the profitability index for each project.
b-1. Calculate the profitability-index using the incremental cash flows.
b-2. Which project should you choose?
Consider the following projects: Cash Flows ($) Project C0, C1 D

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