Specialty Gases & Chemicals manufactures nitrogen trifluoride, a highly specialized gas used as an industrial cleansing agent

Question:

Specialty Gases & Chemicals manufactures nitrogen trifluoride, a highly specialized gas used as an industrial cleansing agent for flat panels installed in laptop computers, televisions, and desktop monitors. The incremental cash flow associated with two alternatives for chemical storage and handling systems (identified as P3 and X3) has been calculated in $1000 units. Determine

(a) The rate of return on the incremental cash flows

(b) Which one should be selected if the company's MARR is 25% per year?

Alternative X3 requires the larger initial investment.

MARR
Minimum Acceptable Rate of Return (MARR), or hurdle rate is the minimum rate of return on a project a manager or company is willing to accept before starting a project, given its risk and the opportunity cost of forgoing other...