Using the data from Problem 6-7, create a spreadsheet to identify the best design using an IRR

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Using the data from Problem 6-7, create a spreadsheet to identify the best design using an IRR analysis.


Data from Problem 6-7:

Three mutually exclusive design alternatives are being considered. The estimated cash flows for each alternative are given next. The MARR is 20% per year. At the conclusion of the useful life, the investment will be sold.

$28,000 $55,000 $40,000 Annual expenses $15,000 $13,000 $22,000 Annual revenues $23,000 $28,000 $32,000 $8,000 $10,000 1

A decision-maker can select one of these alternatives or decide to select none of them. Make a recommendation using the PW method.

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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