What is the profitability index for this project

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Suppose a company has proposed a new 4-year project. The project has an initial outlay of $28,000 and has expected cash flows of $7,000 in year 1, $10,000 in year 2, $12,000 in year 3, and $12,000 in year 4. The required rate of return is 16% for projects at this company. What is the profitability index for this project? (Answer to the nearest hundredth, e.g. 1.23)

Reference no: EM132693208

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