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2. Consider the three small mutually exclusive investment alternatives in the table below. The feasible alternative chosen must provide service for a 10-year period. The MARR is 12% per year, and the market value of each is 0 at the end of useful life. State all assumptions - (Use repeatability and co terminated) you make in your analysis. Which alternative should be chosen? Use the imputed market value technique in alternative C, ɛ = 10% A C Capital investment $2,000 $8,000 $20,000 Annual revenues less 600 2,200 3,600 expenses Useful life (years) 5 10

2. Consider the three small mutually exclusive investment alternatives in the table below. The feasible alternative chosen must provide service for a 10-year period. The MARR is 12% per year, and the market value of each is 0 at the end of useful life. State all assumptions - (Use repeatability and co terminated) you make in your analysis. Which alternative should be chosen? Use the imputed market value technique in alternative C, ɛ = 10% A C Capital investment $2,000 $8,000 $20,000 Annual revenues less 600 2,200 3,600 expenses Useful life (years) 5 10

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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2. Consider the three small mutually exclusive investment alternatives in the table below. The feasible alternative chosen must provide service for a 10-year period. The MARR is 12% per year, and the market value of each is 0 at the end of useful life. State all assumptions – (Use repeatability and co terminated) you make in your analysis. Which alternative should be chosen? Use the imputed market value technique in alternative C, &= 10% A В C Capital investment $2,000 $8,000 $20,000 Annual revenues less 600 2,200 3,600 expenses Useful life (years) 5 10
Transcribed Image Text:2. Consider the three small mutually exclusive investment alternatives in the table below. The feasible alternative chosen must provide service for a 10-year period. The MARR is 12% per year, and the market value of each is 0 at the end of useful life. State all assumptions – (Use repeatability and co terminated) you make in your analysis. Which alternative should be chosen? Use the imputed market value technique in alternative C, &= 10% A В C Capital investment $2,000 $8,000 $20,000 Annual revenues less 600 2,200 3,600 expenses Useful life (years) 5 10
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