Each of the three mutually exclusive alternatives shown has a 5-year useful life. If the MARR is 10%, which alternative should be selected? Solve the problem by benefit-cost ratio analysis.
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![Each of the three mutually exclusive alternatives shown has a 5-year useful life. If the MARR is
10%, which alternative should be selected? Solve the problem by benefit-cost ratio analysis.
A
B
Cost
Uniform annual benefit
$600.0
158.3
$500.0
138.7
с
$200.0
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- The following information is provided for five mutually exclusive alternatives that have 20-year useful lives. If the MARR is 12%, which alternative be selected? Use incremental rate of return Alternatives A B D E Cost $4,000 $2,000 $6,000 $1,000 $9,000 Annual Benefit $639 $410 $761 $117 $785 PW of Benefit $7,330 $4,700 $8,730 $1,340 $9,000 Rate of Return 15% 20% 11% 10% 6%Would love some help on how to approach this - thanks! The cash flows for three different alternatives are given in table below. MARR =10%. Alt. A Alt. B Alt. C Initial cost $5,000 9,000 7,500 Annual benefits $1,457 2,518 2,133 RoR 14% 13% 12.4% Life in years 5 1. ΔRoR for the first increment (Alt. C-Alt. A) is ___________________. A.10.12% B. 9.38% C. 11.85% D. 11.00% 2. ΔRoR for the second increment is ___________________. A. 10.12% B. 9.38% C. 8.94% D. 9.87% 3. The best alternative for a MARR of 10% using the incremental rate of return analysis is ____________. A. Alt. C B. Alt. A C. Alt. B D. Do nothingAny help would be appreciated! Given the data for three different alternatives in the table below, determine the best alternative using the incremental rate of return (∆RoR) analysis. MARR =9%. A B C First cost $15,000 $25,000 $20,000 O &M Cost/ year 1,600 400 900 Benefit/year 8,000 13,000 9,000 Salvage value 3,000 6,000 4,600 Life in years 4 4 4 1. The better alternative between the first increment is ________________. A. Alt. A or Alt. B B. Alt. A C. Alt.C D. Alt. B 2. The better alternative between the second increment is ___________________. A. Alt. B or Alt. C B. Alt. B C. Alt. C D. Alt. A
- Given the data for two different alternatives in the table below, determine the best alternative using the incremental rate of return (AROR) analysis. MARR =9%. A B First cost $15,000 $20,000 O&M Cost/year 1,600 900 Benefit/year 8,000 9,000 Salvage value 3,000 4,600 Life in years 4 4Using Incremental with EUAW analysis find the best alternative, MARR = %10. should use Excel and show your equations seperately, see below example: [A Benefit - [IC (A/P, i%, n) - Salvage (A/F, i, n)] + A Cost+ G Cost (A/G, i, n)] Data B C A First Cost $2,300,000 $2,780,000 $2,540,000 Salvage Value $82,000 $118,000 $97,000 Annual Benefit $580,000 $670,000 $650,000 M&O $65,000 $78,000 $71,000 M&O Gradient $11,000 $15,000 $12,500 Useful Life, Years 9 9 9 You - ZOOMGiven the data for three different alternatives in the table below, determine the best alternative using the incremental rate of return (∆RoR) analysis. MARR =9%. A B C First Cost $15,000 $25,000 $20,000 O &M Cost/ year 1,600 400 900 Benefit/year 8,000 13,000 9,000 Salvage value 3,000 6,000 4,600 Life in years 4 4 4 Group of answer choices Cannot determine Alterative A Alterative B Alterative C
- Using Incremental with EUAW analysis find the best alternative, MARR = %10. should use Excel and show your equations seperately, see below example: [A Benefit - [IC (A/P, i%, n) - Salvage (A/F, i, n)] + A Cost+ G Cost (A/G, i, n)] A B C $2,300,000 $2,780,000 $2,540,000 $82,000 $118,000 $97,000 $580,000 $670,000 $650,000 $65,000 $78,000 $71,000 $11,000 $15,000 $12,500 9 9 9 Data First Cost Salvage Value Annual Benefit M&O M&O Gradient Useful Life, Years YouGiven the data for three different alternatives in the table below, determine the best alternative using the incremental rate of return (∆RoR) analysis. MARR =9%. A B C First cost $15,000 $25,000 $20,000 O &M Cost/ year 1,600 400 900 Benefit/year 8,000 13,000 9,000 Salvage value 3,000 6,000 4,600 Life in years 4 4 4 The better alternative between the second increment (B – C) is:. Group of answer choices Alt. B Alt. C Alt. B or Alt. C Alt. A:[A] { > Incremental analysis ([ B Alternative], [B wins ]): C A company considering 2 different machines at MARR at 12% Both life spans = 10 years Initial Cost Annual Operating lost Benefits per yin ar Salvage Value \table MM If you are and of frying investment to company decide More than 2 alternatives if the additional increment is worth while, compare Alternative: A Incremental analysis (Alternative) pairs then B C A MARR Company at Considering 2 different machines at 12% Both life spans = 10 years. M/C X м/с у Initial Cost 160000 285000 Annual Operating Cost Benefits per year Salvage Value 45 000 90000 45000 105000 20000 40000
- Given cash flows for two alternatives as shown in table below, choose the most attractive alternative if MARR = 8%. Year 0 1 2 3 through ∞ Alt. A -$42K $3.6K $3.6K $3.6K Alt. B -$54K $4.7K $4.7K $4.7K Group of answer choices Alt. A Alt. B Select neither Select eitherDetermine which alternative, if any, should be chosen based on Annual Worth method using 15% MARR. Use Repeatability Method. Alternative A B First Cost (Investment Cost) $ 5,000 $10,200 Uniform Annual Benefit $1,100 $2,300 Useful Life 5 years 10 years a. The Annual Worth of Alternative A is = $ Blank 1 b. The Annual Worth of Alternative B is = $ Blank 2 c. Choose Alternative (Type only A or B) = Blank 3 Note: Show final answer to the nearest WHOLE NUMBER. No need to write the Unit of Measure. Blank 1 Add your answer Blank 2 Add your answer Blank 3 Add your answerThe survey firm of Layer, Anderson, and Pope (MAP) LLP is considering the purchase of a piece of new GPS equipment. Data concerning the alternative under consideration are presented below. First Cost $28,000 Annual Income 7,000 Annual Costs 2,500 Recalibration at end of Year 4 4,000 Salvage Value 2,800 If the equipment has a life of eight years and MAP's minimum attractive rate of return (MARR) is 5%, what is the annual worth of the equipment?
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