16. 6.42 Allstate Insurance Company is considering the installation of one of five fraud detection systems, all of which can be considered to last indefinitely. If the company’s MARR is 14% per year, determine which one should be selected on the basis of a rate of return analysis using the estimates shown.

Table Summary: Table divided into 6 columns shows the items in the first column and the headings from column 2 to 6 marked as: A; B; C; D; and E.

A B C D E First cost, $ −10,000 −25,000 −15,000 −70,000 −50,000 Annual net income,

$/year 2,000 4,000 2,900 10,000 6,000 A B C D E Overall ROR, % 20.0 16.0 19.3 14.3 12.0