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You and your business partners are trying to set up a mass production company, and make a study on the recent market demand. After your
You and your business partners are trying to set up a mass production company, and make a study on the recent market demand. After your team had done a top-down analysis, you and your team are able to collect and tabulate the data into a table as shown in Table Q1. Table 04 Business details Type of Space station Nano-size High Advanced Business temperature food-in-tube microcontroller resistance suits polymer tire chip Startup Cost (RM) 500 750 1,000 2,000 Annual factory and machine 100 170 250 350 maintenance cost (RM) Annual revenue 200 300 500 750 gain (RM) Market / Salvage value 200 250 400 750 (RM) IRR (%) ? ? *all values are in thousand (x1000) As your team decided that the MARR for your company is 15%, compare all the alternative above and explain the reason of your choice by using IRR method and incremental analysis within the horizon of 10 years. (a) Evaluate each alternative whether it is a possible choice or not using IRR method. [15 Marks [CO2, P02] (b) Justify the best alternative among them using incremental analysis
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