ABC Inc

Finance Aug 21, 2020

ABC Inc. is looking at investing in a 3-year project that will create cash inflows of $7,000 in the first year, $8,000 in the second year, and $9,000 in the third year. The cost of this project is $18,000, and the required return is 12%. Should the company invest in this project based on the profitability index criterion?

Multiple Choice

1.06
0.94
1.38
1.14
1.45

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