Based on the Profitability Index (PI) Rule,should a Project with the Following

question 8

Multiple Choice

Based on the profitability index (PI) rule,should a project with the following cash flows be accepted if the discount rate is 8%? Why or why not?

• A) Yes; because the PI is 1.008.
• B) Yes; because the PI is .992.
• C) Yes; because the PI is .999.
• D) No; because the PI is 1.008.
• E) No; because the PI is .992.