Evaluation of Alternatives at i=10% per year A B First Cost (5) Annual O&M ($/year) Major Repair ($) 0 10,000 18,000 5,000 4,000 2,000 after 5 years of operation 40,000 2,000 5,000 after 10 years of operation 7,800 15 2,000 Annual revenues ($/year) life (years) Salvage ($) 7,200 5 2,000 7,500 10 2,000 The incremental IRR of C as challenger and B as defender is: Choose 8.51% 13.70% 8.50% 13.34% 9.10% Evaluation of Alternatives at i=10% per year A B First Cost (5) Annual O&M ($/year) Major Repair ($) 0 10,000 18,000 5,000 4,000 2,000 after 5 years of operation 40,000 2,000 5,000 after 10 years of operation 7,800 15 2,000 Annual revenues ($/year) life (years) Salvage ($) 7,200 5 2,000 7,500 10 2,000 The incremental IRR of C as challenger and B as defender is: Choose 8.51% 13.70% 8.50% 13.34% 9.10%