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Profitability Index You work for EchoLab, a manufacturer of sonar equipment. You are assessing to mutually exclusive projects with the following cash flows: Year 0
Profitability Index You work for EchoLab, a manufacturer of sonar equipment. You are assessing to mutually exclusive projects with the following cash flows: Year 0 Project Bat Project Belfry $-34,000 20,000 20,000 20,000 $-60,000 32,000 32,000 32,000 3 a. You have assessed your company's cost of capital to be 10% and know that you have only sufficient funds to do one or the other. What is the PI of each project? Based upon the profitability index, which of the projects should you choosei? b. What is the NPV of each project? Based upon NPV, which should you choose
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