A Project Has an Initial Investment of $95,000

question 105

Multiple Choice

A project has an initial investment of $95,000. Its four year cash inflows are estimated to be $21,000 in year 1, $23,000 in year 2, $25,000 in year 3, and $27,000 in year 4. If the rate of return
Is 8%, calculate the project's Profitability Index.

• A) 1.83
• B) 1.53
• C) 1.03
• D) 0.83
• E) 0.53

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