[Verse 1] When you've got projects lined up in a row But limited cash is all you can show Capital rationing means you must choose Which investments to pick and which ones to lose The budget constraint is holding you tight Can't fund them all though they look so bright So gather your tools and calculate clear The best combination will soon appear [Chorus] PI first, PI first, profitability index Divide the PV by the cost that you invest Rank them high to low, take the best you know Until your budget's spent and there's no more to go PI first, PI first, that's the golden rule Capital rationing's most important tool [Verse 2] Start with net present value for each Make sure they're positive within your reach But NPV alone won't solve the game When capital's scarce, it's not the same A project worth millions might take all your cash While smaller ones combined could beat it in a dash So calculate how much value you get For every dollar that you're willing to bet [Chorus] PI first, PI first, profitability index Divide the PV by the cost that you invest Rank them high to low, take the best you know Until your budget's spent and there's no more to go PI first, PI first, that's the golden rule Capital rationing's most important tool [Bridge] Sometimes linear programming comes into play When constraints are complex in every way Multiple periods, different resource needs Mathematical optimization succeeds But for single period, single constraint Profitability index is your financial saint [Verse 3] Watch out for projects you cannot divide Take the whole thing or step aside Indivisible projects need special care Integer programming gets you there And remember the mutually exclusive case Only one project can take that space Compare their PI values side by side Let the highest ratio be your guide [Final Chorus] PI first, PI first, profitability index Divide the PV by the cost that you invest Rank them high to low, take the best you know Until your budget's spent and there's no more to go PI first, PI first, maximizes wealth creation Smart capital rationing across the nation [Outro] When capital's tight and choices are tough PI will guide you through the rough Select the mix that gives the most Value per dollar, that's your boast
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