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Given the following regarding ABC corp. & XYZ corp.: ABC 2020 2021 2022 2023 Op Cash 50000 55000 60000 62000 Cap Ex 20000 21000 25000

Given the following regarding ABC corp. & XYZ corp.:

ABC 2020 2021 2022 2023
Op Cash 50000 55000 60000 62000
Cap Ex 20000 21000 25000 26000
Dividends 10000 12000 13000 15000

XYZ 2020 2021 2022 2023
Op Cash 50000 55000 60000 62000
Cap Ex 5000 4000 2500 2000
Dividends 0 0 0 0

Required investment: ABC = $50,000, XYZ = $150,000.

Discount rate = 4%

Calculate the Profitability Index for XYZ

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