Information on four investment proposals is given below:

		Investment Proposal
	A		B		C		D
Investment required	$	(280,000)	$	(140,000)	$	(50,000)	$	(780,000)
Present value of cash inflows		393,900		192,800		78,100		1,038,100
Net present value	$	113,900	$	52,800	$	28,100	$	258,100
Life of the project		5 years		7 years		6 years		6 years

Required:

1.

Compute the project profitability index for each investment proposal. (Round your answers to 2 decimal places.)

Investment Proposal	Project Profitability Index
A
B
C
D

2.

Rank the proposals in terms of preference.

	B C A D
	A B C D
	C A B D
	D C B A