Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts:

Contract	NPV	Use of Facility
A	$1.98 million	100%
B	$0.98 million	51%
C	$1.53 million	49%

a. What are the profitability indexes of the projects?

The profitability index for contract A is ___

(Round to two decimal places.)

The profitability index for contract B is ___

(Round to two decimal places.)

The profitability index for contract C is ___

(Round to two decimal places.)

b. What should Fabulous Fabricators do?

A. Since the profitability index for C is the largest, it should choose C.

B. It should take the two projects with the highest profitability indexes: C and A.

C. Since it has the capacity to do both B and C and NPVB+NPVC is greater than NPVA, it should do both B and C.

D. Since the NPV of A is the largest, it should choose A.