Flo's Flowers has a proposed project with an initial cost of $40,000 and cash flows of $8,500,$15,600,and $22,700 for Years 1 to 3,respectively.Based on the profitability index rule,should the project be accepted if the discount rate is 9.5 percent? Why or why not?
A)Yes; because the PI is 1.03
B)Yes; because the PI is .95
C)Yes; because the PI is negative
D)No; because the PI is 1.03
E)No; because the PI is .95

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The Answer of Flo's Flowers has a proposed project with an initial cost of $40,000 and cash flows of $8,500,$15,600,and $22,700 for Years 1 to 3,respectively.Based on the profitability index rule,should the project be accepted if the discount rate is 9.5 percent? Why or why not?
A)Yes; because the PI is 1.03
B)Yes; because the PI is .95
C)Yes; because the PI is negative
D)No; because the PI is 1.03
E)No; because the PI is .95

Flo's Flowers Has a Proposed Project with an Initial Cost