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4 of 4 (4 complete) This Question: 1 pt Given a MARR of 17%, which alternative should the company select? Alternative RR PW (

The question is comparing two alternatives with different IRR’s and PW’s with a general MARR of 17%. The options are to choose alternative A, B, or to do nothing. I got this question wrong when working on it and don’t understand how to choose one alternative over the other, or when to eliminate both.
engineering   Civil-Engineering   
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Answer #1

B. Do nothing,

When Minimum acceptable rate of return (MARR) greater than Internal rate of return (IRR) then that investment is uneconomic . Since IRR of both companies have less than required MARR , it mean both companies have loss in economy,

A IRR 13.7 % < MARR 17% = NOT advisable to select

B IRR 16.8%. < 17 % = not advisable to select.

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