You are asked to evaluate the following two projects for the Norton corporation. Use a discount

rate of $10$ percent. Use Appendix B for an approximate answer but calculate your final answer

using the formula and financial calculator methods.

a$.$ Calculate the profitability index for project $x.$

Note: Do not round intermediate calculations and round your answer to $2$ decimal places.

Profitability index

b$.$ Calculate the profitability index for project $Y.$

Note: Do not round intermediate calculations and round your answer to $2$ decimal places.

Profitability index

c$.$ Which project would you select based on the profitability index?

Project $x$

Project YYou are asked to evaluate the following two projects for the Norton corporation. Use a discount rate of $10$ percent. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

Project X $($Videotapes of the Weather Report$)($$$24,000$ Investment$)$ Project Y $($Slow$-$Motion Replays of Commercials$)($$$44,000$ Investment$)$

Year Cash Flow Year Cash Flow

$1$ $ $12,0001$ $ $22,000$

$210,000215,000$

$311,000316,000$

$410,600418,000$

Calculate the profitability index for project X$.$

Note: Do not round intermediate calculations and round your answer to $2$ decimal places.

Calculate the profitability index for project Y$.$

Note: Do not round intermediate calculations and round your answer to $2$ decimal places.

Which project would you select based on the profitability index?

multiple choice

Project X

Project Y