Consider the following five alternatives [A-E] that are being evaluated by the rate of return method

1. If the alternatives are independent and the MARR is 14% per year, the one(s) that should be selected is (are):

B, D, & E OR D & E OR D OR B, C, D, & E

2. If the alternatives are mutually exclusive, one alternative must be selected (i.e. there is no do-nothing alternative) and the MARR is 38% per year, the alternative to select is A, B, C, D, or E?

Initial Investment, $ -25,000 -35,000 -40,000 60,000 75,000 Alternative Rate of Return, % 9.6 15.1 13.4 25.4 20.2 Incremental Rate of Return, % Alt. | 27.3 19.4 27.3 19.4 35.3 25 0 38.5 24.4 35.3 38.5 46.5 25 24.4 27.3 -6.8 46.5 27.3 -6.8 Initial Investment, $ -25,000 -35,000 -40,000 60,000 75,000 Alternative Rate of Return, % 9.6 15.1 13.4 25.4 20.2 Incremental Rate of Return, % Alt. | 27.3 19.4 27.3 19.4 35.3 25 0 38.5 24.4 35.3 38.5 46.5 25 24.4 27.3 -6.8 46.5 27.3 -6.8