A firm is considering a project that requires an initial investment of $160,000. The life of this project is five years. Cash flows for each year are estimated as follows: Year 1 Year 2 Year 3 Year 4 Year 5 $60,000 $80,000 $140,000 $30,000 -$120,000 The cost of capital of this project is 8%. Calculate the profitability index of the project and make a decision. Reject since the Pl is 0.81, which is less than 1. Accept since the Pl is 1.10, which is larger than 1. Reject since the Pl is 1.10, which is larger than 1. Accept since the Pl is 0.81, which is less than 1. Cannot be determined