A Project Requires an Investment of $2,500 and Has a Net

question 105

Multiple Choice

A project requires an investment of $2,500 and has a net present value of $430. If the internal rate of return is 10%, what is the profitability index for the project?

• A) 0.25
• B) 2.33
• C) 0.70
• D) 1.17

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Definitions:

Social Security Benefits

Government-funded financial benefits provided to retired workers, disabled individuals, and their families, aiming to support financial stability.

Health Insurance Coverage

A form of insurance that covers the whole or part of the risk of a person incurring medical expenses.

Cafeteria-Style Plans

Flexible benefit plans allowing employees to choose from a variety of pre-tax benefits options to create a package tailored to their personal needs and preferences.

Flexible Spending Accounts

Tax-advantaged accounts that allow employees to save pre-tax dollars for eligible health care and dependent care expenses.