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2. Your firm is considering the following 3 mutually exclusive alternatives. Interest rate is 10%. A B $21,000.00 $3,300.00 Initial Cost Annual Benefit Salvage value
2. Your firm is considering the following 3 mutually exclusive alternatives. Interest rate is 10%. A B $21,000.00 $3,300.00 Initial Cost Annual Benefit Salvage value Project life $35,000.00 $4,200.00 0 Forever $42,000.00 $5,000.00 1500 50 $1,000 20 year a. Calculate the Benefit Cost ratio of each project ), O: b. Which of the 3 alternatives should be selected using B/C ratio analysis (show your work)? Alternative Selected
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