Probability Index Question

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This topic contains 2 replies, has 3 voices, and was last updated by avatar sunflowerdragon 4 years, 9 months ago.

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    jrow
    Participant

    Hey, can anyone tell me the probablity index can only be used for projects that are divisible?
    Thanks,

    j


    Are you refering to profitability index or probability index? please specify


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    sunflowerdragon
    Participant

    Profitability Index yes used for divisible projects only. its calculated as NPV divided by Initial Investment (you get NPV per $ invested) .You will use the PI to rank the projects.

    hope this ans yr qns

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