Question: Consider the following projects: Project C 0 C 1 C 2 A $3,900 +$3,800 +$3,000 B 3,900 + 3,240 + 3,528 1a. Calculate the profitability

Consider the following projects:

Project	C₀	C₁	C₂
A	$3,900	+$3,800	+$3,000
B	3,900	+ 3,240	+ 3,528

1a.

Calculate the profitability index for A and B assuming a 22% opportunity cost of capital. (Do not round intermediate calculations. Round your answers to 4 decimal places.)

Project	Profitability Index
A
B

1b.

Use the profitability index rule to determine which project(s) you should accept.

	Project A
	Project B
	Both A and B

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