California Company is trying to determine the relative profitability of two alternative investments. Investment A requires an
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California Company is trying to determine the relative profitability of two alternative investments. Investment A requires an initial cash outlay of $\$ 10,000$ and has a net present value of $\$ 500$. Investment B requires an initial cash outlay of $\$ 2,000$ and has a net present value of $\$ 150$. Compute the profitability index of each investment. Which alternative is more profitable?
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Related Book For 
Survey Of Accounting
ISBN: 9780538846172
1st Edition
Authors: James D. Stice, W. Steve Albrecht, Earl Kay Stice, K. Fred Skousen
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