The Whenworth Corporation is trying to choose between the following two mutually exclusive design projects:

a. If the required return is 11 percent and the company applies the profitability index decision rule, which project should the firm accept?

b. If the company applies the NPV decision rule, which project should it take?

c. Explain why your answers in parts (a) and (b) are different

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Cash Flow (I) Cash Flow (II) Year -$84,000 -$29,800 30,600 10,500 2 36,900 17,400 3 43,700 15,600