Yokam Company is considering two alternative projects. Project $1$ requires an initial investment of $$460,000$ and has a present value of all its cash flows of $$1,450,000.$ Project $2$ requires an initial investment of $$4$ million and has a present value of all its cash flows of $$6$ million.

$($a$)$ Compute the profitability index for each project.

$($b$)$ Based on the profitability index, which project should the company select?

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

Required $A$

Compute the profitability index for each project.

$\backslash$table$[[$Profitability Index,$],[,$Numerator:,$1,$Denominator:,$=,$Profitability Index$],[,,1,,=,$Profitability index$],[,,,,,],[$Project $1,,,,,],[$Project $2,,,,,]]$