Your company has extra cash which it would like to use to invest into something new and profitable. There are two mutually exclusive projects under consideration.

Project #1 will require an initial investment of $280, and the present value of all of its future estimated profits is $240.

Project #2 will require an initial investment of $240, and the present value of all of its future estimated profits is $190.

Based on this information, answer the following questions.

(a) For Project #1, the Profitability Index equals . Round to TWO decimal places, for example, 1.23

(b) For Project #2, the Profitability Index equals . Round to TWO decimal places, for example, 1.23

(c) Based on the Profitability Indexes, your company should (type accept or reject) Project #1 and (type accept or reject) Project #2.