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Which alternative should be selected using incremental rate of return analysis, if MARR = 12.0%?

Which alternative should be selected using incremental rate of return analysis, if MARR = 12.0%?

Essentials Of Investments
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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Which alternative should be selected using incremental rate of return analysis, if MARR = 12.0%? First cost Annual benefit Life ROR Do-nothing 0 10 yrs A B $6,500 $3,500 1,246 765 с D $7,500 $5,000 1,523 779 14.0% 17.5% 15.5% 9.0% B, because its ROR is the highest something other than C, because C costs the most initially C because C has the highest annual benefit C, because the C-B increment has a ROR of 13.70% and the A-B increment has a ROR of 9.66%
Transcribed Image Text:Which alternative should be selected using incremental rate of return analysis, if MARR = 12.0%? First cost Annual benefit Life ROR Do-nothing 0 10 yrs A B $6,500 $3,500 1,246 765 с D $7,500 $5,000 1,523 779 14.0% 17.5% 15.5% 9.0% B, because its ROR is the highest something other than C, because C costs the most initially C because C has the highest annual benefit C, because the C-B increment has a ROR of 13.70% and the A-B increment has a ROR of 9.66%
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