Question 10 (3 points) An investment project for Tahoe Reno requires a net investment of $100,000 and is expected to generate annual net cash inflows of $25,000 for 6 years. The firm's cost of capital is 12 percent. Determine the profitability index for this project. 1.50 1.028 The answer cannot be calculated from the information given in the question. .028 .972 Question 14 (3 points) If a layman asks you to explain the relationship between NPV and IRR, you could answer correctly using this statement: if the NPV of a project is negative, the IRR must be greater than the cost of capital. I none of the above both approaches always provide the same ranking of alternative investment projects. the IRR of a project is equal to the firm's cost of capital if the NPV of a project is $0. Question 15 (3 points)