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Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract A B NPV
Fabulous Fabricators needs to decide how to allocate space in its production facility this year. It is considering the following contracts: Contract A B NPV $1.97 million $0.97 million $1.52 million Use of Facility 100% 59% 41% a. What are the profitability indexes of the projects? b. What should Fabulous Fabricators do? a. What are the profitability indexes of the projects? The profitability index for contract Ais (). (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? (Select the best choice below.) O A. Since the NPV of A is the largest, it should choose A. B. Since the profitability index for C is the largest, it should choose C
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