Homework Answers
using RATE function in Excel
| Investment Considered | (A-DN) | (C-A) | (B-C) |
| Investment cost | -15000 | -2000 | -3250 |
| Annual Revenue | 4000 | 900 | 460 |
| Annual costs | -1000.0 | -150 | -125 |
| Market value | 6000 | -2220 | 3300 |
| Incremental IRR | 12.7% | 10.5% | 10.5% |
As the incremental IRR of B-C is greater than MARR of 9%, therefore Alternative B is the most preferred alternative
Correct answer is option D ie. Alternative B
Showing formula in excel
| Investment Considered | (A-DN) | (C-A) | (B-C) |
| Investment cost | -15000 | -2000 | -3250 |
| Annual Revenue | 4000 | 900 | 460 |
| Annual costs | -1000 | -150 | -125 |
| Market value | 6000 | -2220 | 3300 |
| Incremental IRR | =RATE(6,(AC23+AC24),AC22,AC25) | =RATE(6,(AD23+AD24),AD22,AD25) | =RATE(6,(AE23+AE24),AE22,AE25) |
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For the following table, assume a MARR of 9% per year and a useful life for each alternative of six years that equals t...
For the following table, assume a MARR of 9% per year and a useful life for...
For the following table, assume a MARR of 9% per year and a useful life for each alternative of six years that equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Do Nothing AC B. Complete the IRR analysis by selecting the preferred alternative. A C CB Do Nothing A - $3,500 A Capital investment A Annual revenues A Annual costs A Market value -$2,000 -$15,000 4,000 - 1,000 900 450 -150...
For the following table, assume a MARR of 12% per year and a useful life for...
For the following table, assume a MARR of 12% per year and a useful life for each alternative of eight years which equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Z ·Y? W? X Complete the incremental analysis by selecting the prefer ed altemative. Do nothing" is not an option. $250 $400 $100 Capital investment ? Annual cost savings ? Market value ? PW (12%) 70 100 138 90 50 67...
NOT IN EXCEL 7.For the following table assume a MARR of 6% per year, and a...
NOT IN EXCEL
7.For the following table assume a MARR of 6% per year, and a useful life for each alternative of six years. Which equals the study period. The rank order of alternatives from least capital to greatest capital investment is A, C, B. Complete the PW-Incremental Analysis by selecting the preferred alternative. (5ptos) V A Capital Investment A Annual Revenues A Annual Cost A Market Value APW A $15,000 4,000 1,000 6,000 $3,982 A(C-A) A(B-C) $2,000 $3,000 900...
engineering economy QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A...
engineering economy
QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A B C E Capital investment $60,000 $90,000 $40,000 $30,000 $70,000 Annual expenses $30,000 $40,000 $25,000 $15,000 $35,000 Annual revenues $50,000 $52,000 $38,000 $28,000 $45,000 MV at EOY 10 $15,000 $15,000 $10,000 $10,000 $15,000 IRR 31.5 % 7.4 % 30.8 % 42.5 % 9.2 % The life span of all alternatives is 10 years.. Using a MARR of 15 % per year, what is the...
Complete the following analysis of cost alternatives and select the preferred alternative. The study period is...
Complete the following analysis of cost alternatives and select the preferred alternative. The study period is 10 years and the MARR = 15% per year. "Do Nothing" is not an option. Capital investment Annual costs Market value at EOY 10 FW (15%) A B C $15,000 $16,100 $13,000 260310450 9 00 1,250 1,800 - $65,062 -$70,178 ??? D $18,000 90 1,950 - $72,697 Click the icon to view the interest and annuity table for discrete compounding when i = 15%...
The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives...
The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives is 10 years. A В C Capital investment Annual expenses $60,000 $90,000 $40,000 $30,000 $70,000 35,000 45,000 15,000 30,000 40,000 25,000 16,000 Annual revenues 50,000 52.000 38,000 28,000 Market value at EOY 10 15,000 10,000 10,000 39.0% 10,000 IRR ??? 7.4% 30.8% 9.2% After the base alternative has been identified, the first comparison to be made in an incremental analysis should be which of...
site The estimated negative cash flows for three design alternatives are shown below. The MARR is...
site The estimated negative cash flows for three design alternatives are shown below. The MARR is 10% per year and the study period is six years. Which alternative is best based on the IRR method? Doing nothing is not an option. Alternative FOY A $80,900 0 $63,000 $70,400 Capital investment Annual expenses 1-6 6,900 11,100 9,150 Which alternative would you choose as a base one? Choose the correct answer below. O A. Alternative B OB. Alternative C OC. Alternative Analyze...
For the following table, assume a MARR of 9% per year and a useful life for each alternative of six years that equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Do Nothing AC B. Complete the IRR analysis by selecting the preferred alternative. A C CB Do Nothing A - $3,500 A Capital investment A Annual revenues A Annual costs A Market value -$2,000 -$15,000 4,000 - 1,000 900 450 -150...
For the following table, assume a MARR of 12% per year and a useful life for each alternative of eight years which equals the study period. The rank-order of alternatives from least capital investment to greatest capital investment is Z ·Y? W? X Complete the incremental analysis by selecting the prefer ed altemative. Do nothing" is not an option. $250 $400 $100 Capital investment ? Annual cost savings ? Market value ? PW (12%) 70 100 138 90 50 67...
NOT IN EXCEL
7.For the following table assume a MARR of 6% per year, and a useful life for each alternative of six years. Which equals the study period. The rank order of alternatives from least capital to greatest capital investment is A, C, B. Complete the PW-Incremental Analysis by selecting the preferred alternative. (5ptos) V A Capital Investment A Annual Revenues A Annual Cost A Market Value APW A $15,000 4,000 1,000 6,000 $3,982 A(C-A) A(B-C) $2,000 $3,000 900...
engineering economy
QUESTION 2 The following mutually exclusive investment alternatives have been presented to you A B C E Capital investment $60,000 $90,000 $40,000 $30,000 $70,000 Annual expenses $30,000 $40,000 $25,000 $15,000 $35,000 Annual revenues $50,000 $52,000 $38,000 $28,000 $45,000 MV at EOY 10 $15,000 $15,000 $10,000 $10,000 $15,000 IRR 31.5 % 7.4 % 30.8 % 42.5 % 9.2 % The life span of all alternatives is 10 years.. Using a MARR of 15 % per year, what is the...
Complete the following analysis of cost alternatives and select the preferred alternative. The study period is 10 years and the MARR = 15% per year. "Do Nothing" is not an option. Capital investment Annual costs Market value at EOY 10 FW (15%) A B C $15,000 $16,100 $13,000 260310450 9 00 1,250 1,800 - $65,062 -$70,178 ??? D $18,000 90 1,950 - $72,697 Click the icon to view the interest and annuity table for discrete compounding when i = 15%...
The following mutually exclusive investment alternatives have been presented to you. The life of all alternatives is 10 years. A В C Capital investment Annual expenses $60,000 $90,000 $40,000 $30,000 $70,000 35,000 45,000 15,000 30,000 40,000 25,000 16,000 Annual revenues 50,000 52.000 38,000 28,000 Market value at EOY 10 15,000 10,000 10,000 39.0% 10,000 IRR ??? 7.4% 30.8% 9.2% After the base alternative has been identified, the first comparison to be made in an incremental analysis should be which of...
site The estimated negative cash flows for three design alternatives are shown below. The MARR is 10% per year and the study period is six years. Which alternative is best based on the IRR method? Doing nothing is not an option. Alternative FOY A $80,900 0 $63,000 $70,400 Capital investment Annual expenses 1-6 6,900 11,100 9,150 Which alternative would you choose as a base one? Choose the correct answer below. O A. Alternative B OB. Alternative C OC. Alternative Analyze...
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