Information on four investment proposals is given below:

Exercise 13-4 Preference Ranking [LO4]

Information on four investment proposals is given below:

		Investment Proposal
	A		B		C		D
Investment required	$	(85,000)	$	(200,000)	$	(90,000)	$	(170,000)
Present value of cash inflows		119,000		250,000		135,000		221,000
Net present value	$	34,000	$	50,000	$	45,000	$	51,000
Life of the project		5 years		7 years		6 years		6 years

Required:
1.	Compute the project profitability index for each investment proposal. (Round your answers to 2 decimal places.)

Proposal	Project Profitability Index
A	.40
B	.25
C	.50
D	.30

2.	Rank the proposals in terms of preference.
	D C B A