The Profitability Index for a Project Costing $40,000 and Returning

question 49

Multiple Choice

The profitability index for a project costing $40,000 and returning $15,000 annually for four years at an opportunity cost of capital of 12 percent is:

• A)0.139
• B)0.320
• C)0.500
• D)0.861 PV = 15,000

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Definitions:

Multivariate Approach

A statistical technique that involves the analysis of more than two variables to understand relationships and patterns.

Participant and Risk Sampling

A method in research where participants are selected based on the probability of their exposure to a certain risk or condition, aiming to assess its impact.

Ultimate Goal of Life

The highest or most significant aim an individual strives to achieve during their lifetime, often related to personal fulfillment and happiness.

Catharsis

The expression of emotions that is expected to lead to the reduction of disturbing symptoms.