Compute what is the project profitability index

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Problem 1: A project is projected to cost $1,500,000 to undertake. It will generate positive cash inflows as follows: Year 1 - $400,000; Year 2 - 500,000; Year 3 - $650,000; Year 4 - 750,000; Year 5 - 800,000. What is the project's Profitability Index?

Multiple Choice

Option 1: -1.30
Option 2: -1.42
Option 3: -1.52
Option 4: -1.26

Reference no: EM132936894

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