Calculate the profitability index

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Problem 1

Company C is undertaking a project at a cost of $50 million that is expected to generate future net cash flows with a present value of $65 million. Calculate the profitability index, and explain what the ultimate business decision should be.

Problem 2

McDonald's is undertaking a project at a cost of $180 million that is expected to generate future net cash flows with a present value of $50 million. Calculate the profitability index, and explain what the ultimate business decision should

Reference no: EM133322705

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