The Profitability Index Is Calculated by Dividing the

question 51

Multiple Choice

The profitability index is calculated by dividing the

• A)total cash flows by the initial investment.
• B)present value of cash flows by the initial investment.
• C)initial investment by the total cash flows.
• D)initial investment by the present value of cash flows.

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Definitions:

Workers

Individuals engaged in a particular task or activity, especially in relation to their employment or contribution to the economy.

Marginal Product

The extra output obtained by utilizing an additional unit of a production input.

Additional Revenue

Income that a business generates from activities not related to its primary operations, often enhancing overall earnings.

Unit of Labor

A measure of work or effort performed by a labor force, often used in assessing productivity or efficiency.