(Ignore income taxes in this problem. ) The management of Eversman Corporation is considering the following three investment projects: Rank the projects according to the profitability index,from most profitable to least profitable.

Question

(Ignore income taxes in this problem. ) The management of Eversman Corporation is considering the following three investment projects:  Rank the projects according to the profitability index,from most profitable to least profitable.

Quizplus · Accepted Answer

Project U's profitability index is 0.03 ($810 F1F1F1S1F1F1F10 $27,000),project V's is 0.13 ($5,720 F1F1F1S1F1F1F10 $44,000) and project W's is 0.09 ($6,480 F1F1F1S1F1F1F10 $72,000).Therefore the projects are ranked as follows: V,W,and U.

(Ignore Income Taxes in This Problem