(Ignore income taxes in this problem.) The management of Keno Corporation is considering three investment projects-B, C, and D. Project B would require an investment of $15,000, Project C of $50,000, and Project D of $89,000. The present value of the cash inflows would be $16,350 for Project B, $56,500 for Project C, and $96,120 for Project D.
-Rank the projects according to the profitability index, from most profitable to least profitable.
A) B, D, C
B) C, B, D
C) D, C, B
D) D, B, C
Correct Answer:
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