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Suppose the following two independent investment opportunities are available to Fitz, Inc. The appropriate discount rate is 11 percent. Year 0 Project Alpha -$4,100 2,100
Suppose the following two independent investment opportunities are available to Fitz, Inc. The appropriate discount rate is 11 percent. Year 0 Project Alpha -$4,100 2,100 2,000 1,350 1 Project Beta -$5,700 1,250 4,100 3,800 2 3 a. Compute the profitability index for each of the two projects. (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.) Profitability Index Project Alpha Project Beta b. Which project(s), if either, should the company accept based on the profitability index rule? O Project Alpha O Both projects O Project Beta O Neither project
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