Would love some help on how to approach this - thanks! The cash flows for three different alternatives are given in table below. MARR = 10%. Initial cost Annual benefits ROR Life in years Alt. A Alt. B Alt. C $5,000 9,000 7,500 $1,457 2,518 2,133 14% 13% 12.4% 5 1. AROR for the first increment (Alt. C-Alt. A) is_ A.10.12% B. 9.38% C. 11.85% 2. AROR for the second increment is, A. 10.12% B.9.38% C. 8.94% D. 11.00% D. 9.87% 3. The best alternative for a MARR of 10% using the incremental rate of return analysis is A. Alt. C B. Alt. A C. Alt. B D. Do nothing
Would love some help on how to approach this - thanks! The cash flows for three different alternatives are given in table below. MARR = 10%. Initial cost Annual benefits ROR Life in years Alt. A Alt. B Alt. C $5,000 9,000 7,500 $1,457 2,518 2,133 14% 13% 12.4% 5 1. AROR for the first increment (Alt. C-Alt. A) is_ A.10.12% B. 9.38% C. 11.85% 2. AROR for the second increment is, A. 10.12% B.9.38% C. 8.94% D. 11.00% D. 9.87% 3. The best alternative for a MARR of 10% using the incremental rate of return analysis is A. Alt. C B. Alt. A C. Alt. B D. Do nothing
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![Would love some help on how to approach this - thanks!
The cash flows for three different alternatives are given in table below. MARR = 10%.
Initial cost
Annual benefits
ROR
Life in years
Alt. A Alt. B Alt. C
$5,000 9,000 7,500
$1,457 2,518 2,133
14% 13% 12.4%
1. AROR for the first increment (Alt. C-Alt. A) is
A.10.12% B. 9.38%
A. Alt. C
5
2. AROR for the second increment is
A. 10.12% B. 9.38%
B. Alt. A
C. 11.85% D. 11.00%
C. 8.94%
3. The best alternative for a MARR of 10% using the incremental rate of return analysis is
D. Do nothing
D. 9.87%
C. Alt. B](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2c2f7b2c-0189-426a-b60a-afeae40eab40%2Ffbcb308e-8325-499e-bba0-fab9feefc930%2F7edt3ti_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Would love some help on how to approach this - thanks!
The cash flows for three different alternatives are given in table below. MARR = 10%.
Initial cost
Annual benefits
ROR
Life in years
Alt. A Alt. B Alt. C
$5,000 9,000 7,500
$1,457 2,518 2,133
14% 13% 12.4%
1. AROR for the first increment (Alt. C-Alt. A) is
A.10.12% B. 9.38%
A. Alt. C
5
2. AROR for the second increment is
A. 10.12% B. 9.38%
B. Alt. A
C. 11.85% D. 11.00%
C. 8.94%
3. The best alternative for a MARR of 10% using the incremental rate of return analysis is
D. Do nothing
D. 9.87%
C. Alt. B
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