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  3. the following are the cash flows of two projects:

The following are the cash flows of two projects: Year Project A Project B 0 -290 -290 1 170 190 2 170 190 3 170 190 4 170 If the opportunity cost of...

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Finance

The following are the cash flows of two projects:

YearProject AProject B
0-290-290
1170190
2170190
3170190
4170

If the opportunity cost of capital is 11%, what is theprofitability index for each project? (Do not roundintermediate calculations. Round your answers to 4 decimalplaces.)

ProjectProfitability Index
a
b

Answer & Explanation Solved by verified expert
4.1 Ratings (696 Votes)
Solution Project Profitability Index a 18187 b 16011 Working Notes I II III I x II IV V I x IV Project A Project B Year PVF 11 Cash Flow Present value Cash Flow Present value 0 1 29000 290000 290 29000 1 0900901 17000 153153153 190 171171171 2    See Answer
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