Question: 1. Data for two mutually exclusive alternatives are given in the table below. Assume a life of 7 years and a MARR of 9%. What

1. Data for two mutually exclusive alternatives are given in the table below. Assume a life of 7 years and a MARR of 9%. What is the B /C ratio for the increment A-B? Choose the closest value.

	A	B
Initial cost	$5,600	$3,400
EUAB	$1,400	$1,000
Salvage value	$400	0

Group of answer choices

0.92

1.12

1.02

0.84

2. A plant engineer is considering two types of solar water heating system. The firms

MARR is 12%. Which of the following statement is true?

Group of answer choices

IRR_A > IRR_B, and A is better

NPV_B > NPV_A, and B is better

Payback Period_A > Payback Period_B , and B is better

IRR_A-B > MARR, and A is better

3.The cash flows have a present value of 0. Compute the value of A, assuming an 8% interest rate.

Group of answer choices

1469.34

1058.57

1692.38

1839.83

$1000 $1000 $1000 1 3 4 5 6 7 8 N

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