If the net present value of a project is positive, the profitability index will be greater than 1.0.

Name: If the net present value of a project is positive, the profitability index will be greater than 1.0.
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The profitability index is calculated by dividing the present value of future cash flows by the initial investment. If the net present value (NPV) is positive, it means the present value of future cash flows exceeds the initial investment, resulting in a profitability index greater than 1.0.

If the Net Present Value of a Project Is Positive