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2. Which of the alternatives should be selected on the basis of Incremental Rate of Return analysis where MARR is 12% per year compounded quarterly?
2. Which of the alternatives should be selected on the basis of Incremental Rate of Return analysis where MARR is 12% per year compounded quarterly? The estimated cash flows for each alternative are as follows: (25 pts.) Alternative 1 Alternative 2 Alternative 3 Alternative 4 Initial Investment $50,000 $90,000 S80,000 S60,000 Annual Revenue (per quarter) $2.000 $6,000 $5,00 $3,000 Annual Cost (per semiannual) $1,000 $4,000 $3,000 $1,500 Salvage Value $5,000 $14,000 $10,000 $7,000 Useful Life 8 years 10 years 10 years 10 years
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