Solve the following question by hand using formulas or the BA II Plus calculator if possible: Given the following information and assuming a CCA rate of 20%, what is the profitability index (PI) of this project? Initial investment = $400,000; life = five years; before-tax cost savings = $150,000 per year; salvage value = $30,000 in year 5; tax rate = 34%; discount rate = 14%. Correct answer is 1.10

	1.10
	1.98
	1.07
	0.45
	0.74