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The four alternatives described below are evaluated by the rate of return method. Alternative Initial Investment, $ Overall ROR, i * % i* % When
The four alternatives described below are evaluated by the rate of return method.
Alternative | Initial Investment, $ | Overall ROR, i*% | i*% When Compared with Alternative | ||
A | B | C | |||
A | 40,000 | 29 | - | - | - |
B | 75,000 | 15 | 1 | - | - |
C | 100,000 | 16 | 7 | 20 | - |
D | 200,000 | 14 | 10 | 13 | 12 |
Problem 08.037.b - Determine which mutually exclusive alternative should be selected
If the proposals are mutually exclusive, which one should be selected at an MARR of 9% per year?
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