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DGO Corporation has to decide whether to undertake project 1 or project 2. The projects have...

DGO Corporation has to decide whether to undertake project 1 or project 2. The projects have the following initial investments and future net revenues:

.

 Project 1 Project 2

Initial investment

 $34,000 $40,000

Net revenue in 2021

 $25,000 $35,000

Net revenue in 2022

 $30,000 $45,000

Using IP method and a discount rate of 12%, which project would you recommend? Why or why not. This in reference  to Profitability Index

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jeff jeffy answered 2 years ago
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