what are other names for the profitability index 
the profitability index is also called the profit investment ratio pir cost benefit ratio or the value investment ratio vir the bottom linethe profitability index pi is a measure of the attractiveness of a project or investment it is calculated by dividing the present value of future expected cash flows by the initial investment amount in the project a pi greater than 1 0 is considered to be a good investment with higher values corresponding to more attractive projects the pi is useful for ranking and comparing different projects but it is important to consider how this technique disregards project size and only looks at the present value of future cash flows and the initial investment under capital constraints and when comparing mutually exclusive projects only those with the highest pis should be undertaken 