Alternative Y Capital investment $500,000 $250,000 $400,000 (thousands) Uniform annual $131,900 savings (thousands) $40,690 $44,050 Useful life 10 20 (years)

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Consider the mutually exclusive alternatives given in the table below. The MARR is 10% per year. Assuming repeatability, which alternative should the
company select? (a) Alternative X (b) Alternative Y (c) Alternative Z (d) Do nothing. 

Alternative
Y
Capital
investment
$500,000 $250,000 $400,000
(thousands)
Uniform annual $131,900
savings
(thousands)
$40,690 $44,050
Useful life
10
20
(years)
Transcribed Image Text:Alternative Y Capital investment $500,000 $250,000 $400,000 (thousands) Uniform annual $131,900 savings (thousands) $40,690 $44,050 Useful life 10 20 (years)
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