Solve this problem using the incremental Benefit - Cost ration with, expected life of 10 years and rate of return of 10%

Alternative A

Initial cost

$50,000

Annual maintenance cost $4,000

Estimated annual benefit

$10 000

Alternative B

Initial cost

$30,000

Annual maintenance cost $3,000

Estimated annual benefit

$9,000

O a. Select A with B/C =1.14

O b. Reject A with B/C = 1.14

O c. Select B with B/C = 0.14

O d. Select B with B/C = 1.14

Solve this problem using the incremental Benefit - Cost ration with expected life of 10 years and rate of return of 10% Altemative A Initial cost $50,000 Annual maintenance cost $4,000 Estimated annual benefit $10,000 Alternative B Initial cost $30,000 Annual maintenance cost $3,000 Estimated annual benefit $9,000 O a Select A with B/C =114 O b. Reject A with B/C = 114 O c Select B with B/C = 0.14 O d. Select B with B/C = 114