You are asked to evaluate the following two projects for the Norton corporation. Use a discount rate of 14 percent. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.

Project X (Videotapes of the Weather Report) ($42,000 Investment)		Project Y (Slow-Motion Replays of Commercials) ($62,000 Investment)
Year	Cash Flow		Year	Cash Flow
1	$	21,000			1	$	31,000
2		19,000			2		24,000
3		20,000			3		25,000
4		19,600			4		27,000

a.	Calculate the profitability index for project X.

Profitability index

b.	Calculate the profitability index for project Y.