AT&T considers rebuilding a central cell tower, which was destroyed by hurricane Sandy. The contractor showed some possible plans and the company narrowed it down to 2 alternatives with the following given data:

Investment: Alt 1: $4,500,000 Alt 2: $3,500,000

Annual O&M: Alt 1: $200,000 (start of EOY1) Alt 2: $250,000 (Start EOY1)

Annual Revenue: Alt1: $1,300,000 (start EOY2) Alt 2: $1,400,000 (Start EOY2)

MARR 18% Program Life 20 Years

Calculate the BCR for each option using the Present Worth Analysis

Using the Incremental benefit Cost analysis, which program should be selected and why?