Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It...

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Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract A NPV $1.96 million Use of Facility 100% BC 58% 42% $1.04 million $1.45 million a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do? Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract A NPV $1.96 million Use of Facility 100% BC 58% 42% $1.04 million $1.45 million a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do?

Answer rating: 100% (QA)

To calculate the profitability index PI of each project you can use the formula PI Net Present Value ... View the full answer