Q3) For a 12% per year MARR, consider the following two investment projects: Project A Net Cash Flow, BD Project B Net Cash Flow, BD Year -2000 -3000 1 1000 1100 2 700 1900 3 1000 1100 4 700 Determine the following: a) Based on Rate of Return analysis (IRR), which project would you select? Why? b) Based on Simple Payback analysis (np), which project would you select? Why? c) Which analysis method is better to use in engineering analysis? Why?

Q3) For a 12% per year MARR, consider the following two investment projects: Project A Net Cash Flow, BD Project B Net Cash Flow, BD Year -2000 -3000 1 1000 1100 2 700 1900 3 1000 1100 4 700 Determine the following: a) Based on Rate of Return analysis (IRR), which project would you select? Why? b) Based on Simple Payback analysis (np), which project would you select? Why? c) Which analysis method is better to use in engineering analysis? Why?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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