Question

A project’s PI can be less than 1, but never less than 0. True/False, why?

Answer 1

A projects Profitability Index (PI) it can be one or more than one or less than 1, If the PI is more than 1 than the project is profitable and good for company. If the PI is less than 1 than the project will destroy the wealth of the company and not good for company.When the PI is equal to 1 it means the PI is at break even level.

As per the above explanation PI can be less than 1 or equal to 1 or greater than 1 . So it means the given statement is false.

Answer = False