The management of Riker Inc. is exploring five different investment opportunities. Information on the five projects under study follows:

Project Number

$12345$

Investment required $ $(310,000)$ $ $(460,000)$ $ $(270,000)$ $ $(460,000)$ $ $(400,000)$

Present value of cash inflows at a $10\%$

discount rate $407,620548,860343,770406,290495,480$

Net present value $ $97,620$ $ $88,860$ $ $(73,770)$ $ $53,710$ $ $95,480$

Life of the project $6$ years $3$ years $5$ years $12$ years $6$ years

The company$$s required rate of return is $10\%$; thus, a $10\%$ discount rate has been used in the preceding present value computations. Limited funds are available for investment, and so the company cannot accept all of the available projects.

Required:

$1.$ Compute the profitability index for each investment project