5 Five mutually exclusive investment alternatives have been proposed. Based on benefit-cost ratio analysis, and a MARR of 15%, which alternative should be selected? Year A B C D E 0 -$200 -$100 -$125 -$150 -$225 1-5 68 25 42 52 68
5 Five mutually exclusive investment alternatives have been proposed. Based on benefit-cost ratio analysis, and a MARR of 15%, which alternative should be selected? Year A B C D E 0 -$200 -$100 -$125 -$150 -$225 1-5 68 25 42 52 68
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Please do 9-36

Transcribed Image Text:9-35
O
life, and a 25% MARR, determine which of the fol-
lowing mutually exclusive alternatives should be
selected.
Cost
Annual benefit
A
D E
$100 $200 $300 $400 $500
37 60 83 137 150
9-36 Five mutually exclusive investment alternatives have
been proposed. Based on benefit-cost ratio analysis,
and a MARR of 15%, which alternative should be
selected?
A
Year
0
1-5
A
B
C
D
E
-$200 -$100 -$125 -$150 -$225
68
25
42
52
68
9-37 Three mutually exclusive projects are being consid-
ered by Sesame Street Productions (SSP). SSP uses
a MARR of 8%. SSP has heard about
your excellent
analysis skills and wants you to help them make a
decision. Using a B/C analysis, which project do you
recommend to SSP? Assume all benefits and costs
repeat for Project A.
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