$\begin{array} { c c c c c } & 0 & 1 & 2 & 3 \\\text { Investment B: } & - \$ 1 \text { million } & \$ 500,000 & \$ 400,000 & \$ 300,000\end{array}$

question 34

Multiple Choice

$\begin{array} { c c c c c } & 0 & 1 & 2 & 3 \\\text { Investment B: } & - \$ 1 \text { million } & \$ 500,000 & \$ 400,000 & \$ 300,000\end{array}$
The timeline of an investment is shown above. If the cost of capital is 5%, what is the profitability index of this investment?

• A) 0.256
• B) 0.098
• C) 0.105
• D) 0.368