The management of Revco Products is exploring four different investment opportunities. Information on the four projects under study follows: Project Number$1234$Investment required $ $(270,000)$ $ $(450,000)$ $ $(360,000)$ $ $(480,000)$ Present value of cash inflows $336,140522,970433,400567,270$ Net present value $ $66,140$ $ $72,970$ $ $73,400$ $ $87,270$ Life of the project $6$ years $3$ years $12$ years $6$ yearsInternal rate of return $18\%19\%14\%16\%$ The net present values above have been computed using a $10\%$ discount rate. Limited funds are available for investment, so the company cant accept all of the available projects. Required: $1.$ Compute the profitability index for each investment project. $2.$ Rank the four projects according to preference, in terms of net present value, profitability index, and internal rate of return.Homework

Present value of cash inflows

Net present value

Life of the project

Internal rate of return

The net present values above have been computed using a $10\%$ discount rate. Limited funds are available for investment, so the company can't accept all of the available projects.

Required:

Compute the profitability index for each investment project.

Rank the four projects according to preference, in terms of net present value, profitability index, and internal rate of return.

Complete this question by entering your answers in the tabs below.

Required $1$

Required $2$

Rank the four projects according to preference, in terms of net present value, profitability index, and internal rate of return.

$\backslash$table$[[,\backslash$table$[[$Net Present$],[$Value$]],\backslash$table$[[$Profitability$],[$Index$]],\backslash$table$[[$Internal Rate$],[$of Return$]]],[$First preference,,,$],[$Second preference,,,$],[$Third preference,,,$],[$Fourth preference,,,$1],[,,$ Requir,$]]$

$2$ of $7$