Question
You are offered an investment with returns of $ 1,789 in year 1, $ 4,572 in year 2, and $ 5,513 in year 3. The
You are offered an investment with returns of $ 1,789 in year 1, $ 4,572 in year 2, and $ 5,513 in year 3. The investment will cost you $ 5,107 today. If the appropriate Cost of Capital (quoted interest rate) is 11.0 %, what is the Profitability Index of the investment?
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