Which of the Following Is True Regarding the Profitability Index

question 25

Multiple Choice

Which of the following is true regarding the profitability index?

• A) It is unreliable when used for choosing between different projects.
• B) Attention must be taken when using it to make sure that all of the constrained resource is used.
• C) It does not use the net present value (NPV) to assess benefits.
• D) It is very simple to compute.

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