Question: 8. If the interest rate is 12% per year compounded monthly, compare the alternatives shown below on the basis of an incremental rate of return

8. If the interest rate is 12% per year compounded monthly, compare the alternatives shown below on the basis of an incremental rate of return analysis Alternative 1 Alternative 2 First cost $22000 $32000 Annual operating cost $4500 $5500 Monthly income $1600 $2100 Salvage value $3000 $5000 Life, years 5 4 8. If the interest rate is 12% per year compounded monthly, compare the alternatives shown below on the basis of an incremental rate of return analysis Alternative 1 Alternative 2 First cost $22000 $32000 Annual operating cost $4500 $5500 Monthly income $1600 $2100 Salvage value $3000 $5000 Life, years 5 4

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