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a. Investment A b. Investment B c. Investment C d. Impossible to determine e. Investments A and C are better f. None of the above

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a. Investment A

b. Investment B

c. Investment C

d. Impossible to determine

e. Investments A and C are better

f. None of the above

Which is the best project according to ARR? Why? Time Immediately 1 years' time 2 years' time 3 years' time 4 years' time 5 years' time Cost of machine Operating profit after depreciation Operating profit after depreciation Operating profit after depreciation Operating profit after depreciation Operating profit after depreciation Project A 000 (200) 50 50 60 50 70 Project B 000 Project C 000 (200) (200) 30 160 30 30 30 30 30 30 160 30

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