Question: Skysong Co. is considering purchasing equipment that has an initial investment of $40000. The company's required rate of return is 12%. Annual cost savings are

Skysong Co. is considering purchasing equipment that has an initial investment of $40000. The company's required rate of return is 12%. Annual cost savings are projected to be $19000 for year 1, $18000 for year 2, and $11000 for year 3. What is the investment's profitability index? Present Value PV of an Annuity Year of 1 at 12% of 1 at 12% 1 0.893 0.893 2 0.792 1.690 3 0.712 2.402 O 0.98 O 1.94 O 1.92 O 1.98

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