Problem 8-13 Calculating Profitability Index [LO 6]

Consider the following cash flows:

Year	Cash Flow
0	$-28,200
1	15,500
2	13,400
3	9,800

Requirement 1:

What is the profitability index for the above set of cash flows if the relevant discount rate is 12 percent? (Do not round intermediate calculations. Round your answer to 3 decimal places (e.g., 32.161).)

Profitability index

Requirement 2:

What is the profitability index if the discount rate is 17 percent? (Do not round intermediate calculations. Round your answer to 3 decimal places (e.g., 32.161).)

Profitability index

Requirement 3:

What is the profitability index if the discount rate is 24 percent? (Do not round intermediate calculations. Round your answer to 3 decimal places (e.g., 32.161).)

Profitability index

Problem 8-17 NPV and Profitability Index [LO 4, 6]

Dahlia Manufacturing has the following two possible projects. The required return is 14 percent.

Year	Project Y	Project Z
0