6.43 Caroline received the analysis below from an employee concerning four revenue proposals. Ai*, When Compared with Proposal Initial Overall Proposal Investment, S i*, % A B C ABCD -40,000 29 -75,000 15 -100,000 16 -200,000 14 564 916 7 10 13 20 225 12 a. If the proposals are independent, which one(s) should she select at MARR = 15.5% per year? b. If the proposals are mutually exclusive, which one should she select at MARR = 10% per year? c. If the proposals are mutually exclusive, which one should she select at MARR = 14% per year?

Individual Income Taxes
43rd Edition
ISBN:9780357109731
Author:Hoffman
Publisher:Hoffman
Chapter13: Tax Credits And Payment Procedures
Section: Chapter Questions
Problem 14CE
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6.43 Caroline received the analysis below from an employee concerning four revenue proposals.
Ai*, When
Compared with Proposal
Initial
Overall
Proposal Investment, S
i*, %
A
B
C
ABCD
-40,000
29
-75,000
15
-100,000
16
-200,000
14
564
916
7
10
13
20
225
12
a. If the proposals are independent, which one(s) should she select at MARR = 15.5% per year?
b. If the proposals are mutually exclusive, which one should she select at MARR = 10% per year?
c. If the proposals are mutually exclusive, which one should she select at MARR = 14% per year?
Transcribed Image Text:6.43 Caroline received the analysis below from an employee concerning four revenue proposals. Ai*, When Compared with Proposal Initial Overall Proposal Investment, S i*, % A B C ABCD -40,000 29 -75,000 15 -100,000 16 -200,000 14 564 916 7 10 13 20 225 12 a. If the proposals are independent, which one(s) should she select at MARR = 15.5% per year? b. If the proposals are mutually exclusive, which one should she select at MARR = 10% per year? c. If the proposals are mutually exclusive, which one should she select at MARR = 14% per year?
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