What is the profitability index of a project that has a current cost o

What is the profitability index of a project that has a current cost of $100,000 and expected cash flows of $50,000 at the end of each of the next 7 years if the cost of capital is 20%?

A) .001
B) .018
C) 1.80
D) 1.18
E) 1.25

 

 

ANSWER

C

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