profitability index method

Tag: profitability index method

Profitability Index Method Formula

See Also: Profitability Index Method Profitability Index Method Formula Explanation Use the following formula where PV = the present value of the future cash flows in question. Profitability Index = (PV of future cash flows) ÷ Initial investment Or = (NPV + Initial investment) ÷ Initial Investment: As one would expect, the NPV stands for the Net Present Value

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