The Profitability Index Is Computed by Dividing the

question 125

Multiple Choice

The profitability index is computed 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:

Fish

Aquatic animals, primarily used as a source of food, characterized by their gills, fins, and in most cases, scales.

Leisure Time

Free time not consumed by work or compulsory activities, where individuals can engage in activities of their choice.

Study Time

The dedicated duration individuals allocate toward educational activities to learn or enhance knowledge and skills.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or choosing to do one thing over another.