Use the NPV method to determine whether KayElle Products should invest in the following projects:

Project $A$ : Costs $$300,000$ and offers $8$ annual net cash inflows of $$62,000.$ KayElle Products requires an annual return of $16\%$ on investments of this nature.

Project B: Costs $$350,000$ and offers $9$ annual net cash inflows of $$76,000.$ KayElle Products demands an annual return of $14\%$ on investments of this nature

Read the requirements.

View Present Value of $$1$ table.

Present Value of Ordinary Annuity of $$1$ table.

Requirement $2.$ What is the maximum acceptable price to pay for each project?

Maximum

Acceptable Price

Project A $$

Project B $$

Requirement $3.$ What is the profitability index of each project? $($Round to two decimal places, X$.$XX$.)$

Select the formula, then enter the amounts to calculate the profitability index of each project.

Project A $$

Profitability Index

Project B $$