OIf the MARR is 12%, which alternative should be selected?

Entrepreneurial Finance
6th Edition
ISBN:9781337635653
Author:Leach
Publisher:Leach
Chapter8: Securities Law Considerations When Obtaining Venture Financing
Section: Chapter Questions
Problem 1cM
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Question
Three mutually exclusive alternatives may replace
the current equipment.
Year
A
-$25,000
5,000
5,000
-$20,000
-$24,000
10,000
5,000
10,000
5,000
10,000
10,000
5,000
25,000
3.
8,000
5,000
(a) Construct a choice table for interest rates from
0% to 100%.
(b) If the MARR is 12%, which alternative should
be selected?
4110 4
Transcribed Image Text:Three mutually exclusive alternatives may replace the current equipment. Year A -$25,000 5,000 5,000 -$20,000 -$24,000 10,000 5,000 10,000 5,000 10,000 10,000 5,000 25,000 3. 8,000 5,000 (a) Construct a choice table for interest rates from 0% to 100%. (b) If the MARR is 12%, which alternative should be selected? 4110 4
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