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Consider the following two mutually exclusive investment alternatives with given (MARR= 10%) Year Project A1 Project A2 0 -15,000 $ -20,000 $ 1 7,500 $

Consider the following two mutually exclusive investment alternatives with given (MARR= 10%)

Year

Project A1

Project A2

0

-15,000 $

-20,000 $

1

7,500 $

8,000 $

2

7,500 $

15,000 $

3

7,500 $

5,000 $

i*

23.5 %

20 %

a) Find the best alternative of A1 and A2 based on the present worth incremental investment.

b) Find the best alternative of A1 and A2 based on the IRR incremental investment.

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