Two investment alternatives are being considered. The data below have been estimated by a panel of experts, and all cash flows are assumed to be independent. Life is not a variable.

With MARR = 15% per year, determine the mean and standard deviation of the incremental PW [i.e., ˆ†(Bˆ’A)].

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Alternative A Alternative B Std. Std. Expected Deviation Expected Deviation Cash End of Cash of Cash of Cash Flow Flow Year Flow Flow -$8,000 4,000 $0 -$12,000 4,500 $500 600 300 6,000 4,000 6,000 600 4,500 4,500 4,500 300 800 800 300 300