The following cash flow estimates have been developed for two small, mutually exclusive alternatives. The minimum attractive rate of return is 15% per year. IRR of alternative 2 is closest to: A. 12% B. 15% C. 18% D. 20% E. 25% Formula used: _____ The incremental IRR is closest to? A. 12% B. 15% C. 18% D. 20% E. 25% _____ Formula used Which alternative should be selected? A. Alternative 1 B. Alternative 2 C. Neither D. Both 1 and 2 Criterion for selection: _____ An alternative has the following cash flows: benefits = $50,000 per year; dis-benefits = $27,000 per year, Initial cost = $250,000; M&O costs of $10,000 per year. If the alternative has an infinite life and the interest rate is 15% per year, the conventional B/C ratio is closest to: A. 0.91 B. 0.66 C. 0.52 D. 0.48 Formula used: _____ In evaluating three mutually exclusive alternatives by the B/C ratio method, the alternatives were ranked in terms of increasing total equivalent cost (X, Y, and Z respectively), and the following results were obtained for the B/C ratios: 1.1, 0.9, and 1.3 for X, Y and Z respectively. On the basis of these results, you should: A. Select X B. Select Z C. Select X and Z D. Compare X and Z incrementally. E. Compare X, Y and Z incrementally Basis for Choice: _____ An alternative with an infinite life has a conventional B/C ratio of 1.5; with benefits of $50,000 per year and annual maintenance costs of $10,000. At an interest rate of 10%, the initial cost of the alternative is closest to: A. $23, 300 B. $85, 400 C. $146, 100 D, $233, 300 Formula used: _____