If a Company Has Computed the Project Profitability Index of an Investment

Multiple Choice

If a company has computed the project profitability index of an investment project as 0.15,then:

A) the project's internal rate of return is less than the discount rate.
B) the project's internal rate of return is greater than the discount rate.
C) the project's internal rate of return is equal to the discount rate.
D) the relation between the rate of return and the discount rate is impossible to determine from the given data.