Consider the three small mutually exclusive investment alternatives in the table below. The feasible alternative chosen must pr service for a 10-year period. The MARR is 12% per year, and the market value of each is O at the end of useful life. State all assumptions (repeatablity/co-terminated at 5 year study period) you make in your analysis. Which alternative should be chose A B Capital Investment PhP 2,000 PhP 8,000 PhP 20,000 Use IRR (FW equation) analysis. ` Annual revenues less expenses 600 2,200 3,600 Useful life (years) 5 5 10 ANSWER: IRRA = 15.24% ; IRRB = 11.65% ; IRRC = Blank 3% ; Choose alternative Blank 4 Do not use comma and any unit of measure. Use two decimal places in the Final answer.
Consider the three small mutually exclusive investment alternatives in the table below. The feasible alternative chosen must pr service for a 10-year period. The MARR is 12% per year, and the market value of each is O at the end of useful life. State all assumptions (repeatablity/co-terminated at 5 year study period) you make in your analysis. Which alternative should be chose A B Capital Investment PhP 2,000 PhP 8,000 PhP 20,000 Use IRR (FW equation) analysis. ` Annual revenues less expenses 600 2,200 3,600 Useful life (years) 5 5 10 ANSWER: IRRA = 15.24% ; IRRB = 11.65% ; IRRC = Blank 3% ; Choose alternative Blank 4 Do not use comma and any unit of measure. Use two decimal places in the Final answer.
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
Problem 1PS
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Transcribed Image Text: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 (repeatablity/co-terminated at 5 year study period) you make in your analysis. Which alternative should be chosen?
A
B
Capital Investment
PhP 2,000 PhP 8,000 PhP 20,000
Use IRR (FW equation) analysis.
Annual revenues less expenses
600
2,200
3,600
Useful life (years)
5
5
10
ANSWER: IRRA = 15.24% ; IRRB = 11.65% ; IRRC = Blank 3% ; Choose alternative Blank 4
%3D
%3D
Do not use comma and any unit of measure. Use two decimal places in the Final answer.
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