The Michner Corporation is trying to choose between the following two mutually exclusive design projects:



Year Cash Flow (I) Cash Flow (II)
0 −$ 54,000 −$ 19,000
1 25,000 10,200
2 25,000 10,200
3 25,000 10,200


a-1.
If the required return is 11 percent, what is the profitability index for both projects? (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.)




a-2.
If the company applies the profitability index decision rule, which project should the firm accept?


multiple choice 1
Project I
Project Il


b-1.
What is the NPV for both projects? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)




b-2.
If the company applies the NPV decision rule, which project should it take?


multiple choice 2
Project I
Project II