For the following table, assume a MARR of 10% per year and a useful life for each

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For the following table, assume a MARR of 10% per year and a useful life for each alternative of six years that equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Do Nothing †’ A †’ C †’ B. Complete the IRR analysis by selecting the preferred alternative.

Do Nothing → A A→ C C→B A Capital -$15,000 -$2,000 -$3,000 investment A Annual 4,000 900 460 revenues A Annual cos

(a) Do nothing

(b) Alternative A

(c) Alternative B

(d) Alternative C

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...
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Engineering Economy

ISBN: 978-0133439274

16th edition

Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

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