Consider the following projects:
Cash Flows ($)ProjectC0C1D-11,20022,400E-21,20037,100Assume that the projects are mutually exclusive and that the opportunity cost of capital is 12%.
a. Calculate the profitability index for each project. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
ProjectProfitability IndexDEb-1. Calculate the profitability-index using the incremental cash flows. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Profitability-index
b-2. Which project should you choose?
Project DProject E