CFA Practice Question

There are 233 practice questions for this study session.

CFA Practice Question

Financial managers should accept any projects with a profitability index ______.

A. > 0
B. > 1
C. <= cost of capital for the company
Correct Answer: B

User Contributed Comments 3

User Comment
Kiniry Assuming that they are independent projects.
khalifa92 i dont understand why is this applicable some projects might have PI between 0 and 1 but be profitable.
Konstantis if between 0 a and 1 then PV of future cf less than initial investment
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