PQR Corporation is evaluating two mutually exclusive projects, Project P and Project Q, with the following details:

• Project P: Cost of Capital - 12%, Initial Investment - $180,000, Cash Inflow Year 1 - $40,000, Cash Inflow Year 2 - $50,000, Cash Inflow Year 3 - $60,000
• Project Q: Cost of Capital - 11%, Initial Investment - $220,000, Cash Inflow Year 1 - $50,000, Cash Inflow Year 2 - $60,000, Cash Inflow Year 3 - $70,000 Conduct a profitability index analysis for Project P and Project Q. Interpret the results and provide a recommendation on the preferred project.