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Good Morning Food, Inc. is using the profitability index (PI) when evaluating projects. You have to find the PI for the companys project, assuming the
Good Morning Food, Inc. is using the profitability index (PI) when evaluating projects. You have to find the PI for the companys project, assuming the companys cost of capital is 13.86 percent. The initial outlay for the project is $360,935. The project will produce the following end-of-the-year after-tax cash inflows of
Year 1: $160,286
Year 2: $88,465
Year 3: $223,755
Year 4: $420,596
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