Multiple Choice
Use the following mutually exclusive investment cash flows for the question(s) below: 
If the discount rate is 14%, using profitability index which of the following is true?
A) The PI of project A is less than 1.0
B) The PI of project B is less than 1.0
C) Based on the PI, project A is preferable
D) Both projects would be rejected based on the PI criterion
E) Based on the two PI's, it is obvious the IRR for both projects is less than 14%
Correct Answer:
Verified
Correct Answer:
Verified
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