The initial investment required for projects 'A' and 'B' is ₹1,00,000 each. The present value of future cash flows from the projects are ₹1,15,500 and ₹1,19,500 respectively. Calculate the Profitability Index (PI) of pro

CS Executive · Financial and Strategic Management · PYQS · December 2021
The initial investment required for projects 'A' and 'B' is ₹1,00,000 each. The present value of future cash flows from the projects are ₹1,15,500 and ₹1,19,500 respectively. Calculate the Profitability Index (PI) of projects A and B.
(A) PI of A and B - 0.8658 and 0.8368
(B) PI of A and B - 1.155 and 1.195
(C) PI of A and B - 0.8368 and 0.8658
(D) PI of A and B - 1.195 and 1.155

Answer & Explanation:

Correct Answer: Option (B)

Official answer key: (B).

Topics: Financial Management

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