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Dandy's Fun Park is evaluating the purchase of a new game to be located on its Midway. Dandy's has narrowed their choices down to two:
Dandy's Fun Park is evaluating the purchase of a new game to be located on its Midway. Dandy's has narrowed their choices down to two: the Wacky Water Race game and the Whack - A - Mole game. Financial data about the two choices follows. Investment Useful life Estimated annual net cash inflows for 8 years Wacky Water Race $33,000 8 $6,186 Whack-A- Mole $22,000 8 $4, 428 0 Residual value Depreciation method straight-line 0 straight line Using the Internal rate of return to make the decision, which alternative(s) should Family Fun Park select? A. The Wacky Water Race game should be selected; 1.4% lower B. The Whack-A-Mole game should be selected; 2% higher. C. The Whack - A - Mole game should be selected; 1.4% higher . D. The Wacky Water Race game should be selected; 2% lower
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