Please Review the Information on 4 Potential Investments -
Under Conditions of Capital Rationing, Which Project Would Be

Multiple Choice

Please review the information on 4 potential investments:
$\begin{array}{|r|r|r|r|r|}\hline&\text { Project A }&\text { Project B }&\text { Project C }&\text { Project D }\\\hline \text { Initial investment } & \$ 200,000 & \$ 250,000 & \$ 300,000 & \$ 90,000 \\\hline \text { PV of cash inflows } & \$ 285,000 & \$ 295,000 & \$ 420,000 & \$ 94,000 \\\hline \text { Payback period (years) } & 7.2 & 6.0 & 9.5 & 2.0 \\\hline \text { NPV of project } & \$ 85,000 & \$ 45,000 & \$ 120,000 & \$ 4,000 \\\hline \text { Profitability inclex } & 1.43 & 1.18 & 1.40 & 1.04\\\hline \end{array}$
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Under conditions of capital rationing, which project would be favored?

A) Project A
B) Project B
C) Project C
D) Project D