Explore BrainMass

Explore BrainMass

    Pofitability index for two projects

    Not what you're looking for? Search our solutions OR ask your own Custom question.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Consider the following projects:

    Project A: C0: -2100 C1: +2100 C2: +1200
    Project B: Co: -2100 C1: +1440 C2: +1728

    a. Calculate the profitability index for A and B assuming a 22 percent opp. cost of capital

    b. Use the profitability index rule to determine which project(s) you should accept if you could undertake both and if you could undertake only one.

    © BrainMass Inc. brainmass.com November 24, 2022, 11:50 am ad1c9bdddf

    Solution Summary

    The solution calculates profitability index for two projects A and B assuming a 22 percent opportunity cost of capital