$2.(10$ points$)$ Mowbot is also evaluating additional machine guarding for OSHA compliance in the manufacturing area. They have identified three options:

Option A Up front cost $$150,000$

Annual maintenance and operation cost $$65,000$

No residual value

Option B Up front cost $$190,000$

Annual maintenance and operation cost $$56,000$

End of project residual value $$20,000$

Option C Up front cost $$240,000$

Annual maintenance and operation $$40,000$

End of project residual value $$50,000$

Use INCREMENTAL RATE OF RETURN ANALYSIS to determine which alternative to pursue.

Note that doing nothing is not an alternative. Note also that there is no economic benefit from any of the options BUT one of them is still required. Mowbot evaluates projects based on a MARR of $20\%.$