Webley Corp

question 108

Multiple Choice

Webley Corp.is considering two expansion options,but does not have enough capital to undertake both,Project W requires an investment of $100,000 and has an NPV of $10,000.Project D requires an investment of $80,000 and has an NPV of $8,200.If Webley use the profitability index to decide,it should:

• A)choose D because it has a higher profitability index.
• B)choose W because it has a higher profitability index.
• C)choose D because it has a lower profitability index.
• D)choose W because it has a higher profitability index

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