The net present value rule versus the profitability index rule. You must choose between the two projects whose cash flows are projects have the same risk. Compute the net present value (NPV) and the profitability index (PI) for the two projects. Assume a 10 percent discount rate. Which of the projects is better according to each of the two methods? What is the explanation for the differences in rankings between the NPV and PI methods of analysis? Which method is correct? Why