profitabilitetsindeks
Profitabilitetsindeks, also known as profitability index (PI), is a capital budgeting metric that measures the ratio of the present value of expected future cash inflows to the initial investment required for a project. It expresses the value created per unit of invested capital and helps assess whether a project is worthwhile given a discount rate.
Calculation: PI = PV of future cash inflows / initial investment. The present values are computed by discounting
Interpretation and use: A PI greater than 1 indicates a positive NPV and a potentially desirable project;
Limitations: The profitability index depends on the discount rate, which can influence decisions. It may bias
Relation to other metrics: NPV and PI yield the same accept/reject rule for independent projects when the