A company seeking investment opportunities has collected the following information
Project A Project B Project C Project D
Initial investment $400,000 $250,000 $150,000 $270,000
PV of cash inflows $570,000 $295,000 $210,000 $282,000
Payback period (years) 3.6 3.0 4.75 3.5
NPV of project $170,000 $45,000 $60,000 $12,000
Profitability index 1.43 1.18 1.40 1.04
If the company makes a decision based on the net present value, which project will be selected?
A) Project A
B) Project B
C) Project C
D) Project D
A
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