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A firm is reviewing a project that has an initial cost of $71,000. The project will produce annual cash inflows, starting with year 1, of
A firm is reviewing a project that has an initial cost of $71,000. The project will produce annual cash inflows, starting with year 1, of $8,000, $13,400, $18,600, $33,100, and finally in year 5, $37,900. What is the profitability index if the discount rate is 11 percent?
A. | 0.92 |
B. | 0.98 |
C. | 1.02 |
D. | 1.07 |
E. | 1.12 |
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