A Part Time Engineering Economic Analysis professor is planning to invest his extra income of $4000 a year into a stock market and hoping to have $250,000 in his brokerage account after 15 years. What interest rate must he his investments return? Be sure to answer the question as a decimal, for example 12 % would be entered.12. A carpenter had an idea to make money buy buying a house, fixing it up over time and then selling it. He bought a house for $50,000, then he put $12,000 a year into fixing it for 4 years and then sold it for $150,000. What was the rate of return he got on the money he spent. Be sure to answer the question as a decimal, for example 12 % would be entered .12. A lucky lottery winner decided to buy a warehouse and start selling products like Amazon. He bought the building for $2,000,000 he had operation and maintenance expenses of $500,000 a year, but he brought in a whopping $800,000 a year in revenue. Assuming he ran this operation for 10 years and then sold the operation for $4,000,000. What rate of return did he get on this investment Using incremental rate of return analysis, if 10 % is considered the Minimum Attractive Rate of Return which of the following investments would be preferred? Year B 0 1 2 A -30000 12000 12000 12000 -40000 16500 16500 16500 3 O Alt A Alt B Using incremental rate of return, consider the 3 alternatives below and a Minimum Attractive Rate of Return of 7%, which alternative is preferred? Each have a useful life of 20 years and no Salvage value. A B C Initial Investment Annual income $20,000 $55,000 $5,600 $27,000 $2.700 7.75% $2,200 8% 9.06% O Alt A O Alt B O Alt Kruber company located Tennessee is considering two different makes of a blow molding machine for one of its automotive products. The cost data for the two alternatives are provided in table below. MARR = 15%. Using incremental rate of return analysis which Machine should they choose. Hint we want to find out if the rate of return on the incremental cost and benefits of going to the higher cost alternative is greater than 15 % if so, pick the higher cost alternative, otherwise choose the lower cost alternative. Initial cost annual cost annual benefit Machine X $200,000 $55,000 $100,000 $30,000 Machine Y $275,000 $60,000 $120,000 $40,000 Salvage