Solve clearly

A.9 Assume that you are a consulting engineer, and your company car has just been totaled in wreck. You are now selecting a replacement car. Any of the three listed below is acceptable from a functional point of view. (a) Find the incremental rate of return for each pair of alternatives. (b) Draw an arrow diagram showing which alternative to choose if MARR = 15 percent. (c) Show the break points in the MARR (if any), and tell what ranges of MARR favor which alternatives. Annual Annual Increase Resale value Type Cost new O & M cost O & M cost at EOY 4 A. Electra $15,000 51/mi $0.042/mi/yr $3.000 B. Monaco 17,100 48 0.048 4.500 C. Montego 19,500 45 0.027 4.500 The car will be driven about 20,000 miles per year and sold at the end of the fourth year. (Hint: Try i for B-A between 10 and 20 percent; C-A between 20 and 30 percent; C-B between 20 and 30 percent.) [Ans. (a) - A + B 15.3%, - A + C 23.2%, - B + C 29.5%; (b) see diagram below; (c) if MARR > 23.2%, select A; if MARR