Maximizing Profits: New Tool Helps Managers Navigate Budget Constraints
The Profitability Index helps managers decide which investment projects to choose when there is a limited budget. It is a tool that assists in prioritizing projects based on their potential economic value. The main goal is to guide managers in making decisions when faced with budget constraints. The key finding is that the Profitability Index can be useful in categorizing projects, but it should not be the only factor considered when making investment decisions.