The company is considering three capital investment proposals. At this time the company only has funds available to pursue one of the three investments.

	Equipment A	Equipment B	Equipment C
Present value of net cash inflows	$1,695,000	$1,960,000	$2,200,000
Initial investment	($1,500,000)	($1,750,000)	($2,000,000)
Net present value	$195,000	$210,000	$200,000

*initial investment is the amount invested

A. Calculate the Present value index (or profitability index) for each project.

B. Which investment should they choose and why?