ALPHA	BETA	GAMMA
1. Initial Cost ($)	$1,000,000	1,200,000	1,500,000
2. Revenues ($)	$540,000 annually	$565,000 at EOY1 decreasing by $5,000 annually thereafter.	$575,000 from EOY1 to EOY5 inclusively; $580,000 at EOY6 which decreases by 2% annually thereafter
3. Operating Costs ($)	$260,000 at EOY1 increasing by $2,500 annually thereafter.	$230,000 at EOY1 increasing by 1% annually thereafter	$291,000 at EOY1 increasing by $2,000 annually thereafter
4. End-of-life salvage value ($)	200,000	235,000	260,000
5. Useful life (years)	5 years	5 years	10 years

All parameter values are fictitious. EOY = End-of-year The industry standard for retirement homes is 4 years. MARR = 10%

a. The best retirement home based on the simple payback method is

b. The best retirement home based on the discounted payback method is

c. BETAs benefit/cost (B/C) ratio is between

d. GAMMAs benefit/cost (B/C) ratio is between

e. The incremental B/C ratio between ALPHA and GAMMA is between