The Following Information Is Available for a Potential Investment for Panda

question 89

Multiple Choice

The following information is available for a potential investment for Panda Company: $\begin{array}{lr}\text { Initial investment } & \$ 95,000 \\\text { Net annual cash inflow } & 20,000 \\\text { Net present value } & 36,224 \\\text { Salvage value } & 10,000 \\\text { Useful life } & 10 \text { yrs. }\end{array}$ The potential investment's profitability index is

• A)4.75.
• B)3.22.
• C)2.62.
• D)1.38.