Use the table for the question(s) below.
Consider the following list of projects:

-Assuming that your capital is constrained, which investment tool should you use to determine the correct investment decisions?
A) profitability Index
B) incremental IRR
C) net present value (NP
D) internal rate of return (IR

Question

Use the table for the question(s) below.
Consider the following list of projects:
 
-Assuming that your capital is constrained, which investment tool should you use to determine the correct investment decisions?
A) profitability Index 
B) incremental IRR 
C) net present value (NP
D) internal rate of return (IR

Quizplus · Accepted Answer

The profitability index is used to rank investment projects when capital is constrained, as it measures the relative profitability of an investment by comparing the present value of future cash flows to the initial investment cost.

Use the Table for the Question(s) Below