Suppose you are given the following two projects A and B with the cash flows...
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Finance
Suppose you are given the following two projects A and B with the cash flows below, if the cost of capital is 10%, what is the Profitability Index (PI) of projects A and B?
| Year | Project A | Project B |
| 0 | -5000 | -6000 |
| 1 | 1500 | 1500 |
| 2 | 2000 | 2500 |
| 3 | 3000 | 4000 |
| 4 | 3500 | 4000 |
| 1.457;1.492 | ||
| 1.639;1.340 | ||
| 1.622;1.409 | ||
| 1.457;1.340 | ||
| 1.532;1.528 |
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