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A project with PV of inflows ₹15,00,000 and initial outlay ₹10,00,000 has Profitability Index of:
A0.5
B1.0
C2.0
D1.5
Answer & Solution
Correct answer: D. 1.5
1. PI = PV of inflows / Initial outlay.
2. = 15,00,000 / 10,00,000.
3. Result = 1.5.
_Source: ICAI BoS CA Inter Paper 6A, Ch 7 "Investment Decisions", §9_