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Rizwan 1

The document presents financial data for three original alternatives (Alt A, Alt B, Alt C) and their incremental alternatives over a 10-year period. Key metrics include Net Present Value (NPV), Internal Rate of Return (IRR), and External Rate of Return (ERR) for each alternative, with Alt A showing the highest NPV and IRR. The Minimum Attractive Rate of Return (MARR) is set at 15%.

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14 views1 page

Rizwan 1

The document presents financial data for three original alternatives (Alt A, Alt B, Alt C) and their incremental alternatives over a 10-year period. Key metrics include Net Present Value (NPV), Internal Rate of Return (IRR), and External Rate of Return (ERR) for each alternative, with Alt A showing the highest NPV and IRR. The Minimum Attractive Rate of Return (MARR) is set at 15%.

Uploaded by

rizwankashmiri985
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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MARR= 15%

Orginal Alternatives Incremental Alternatives


Alt A Alt B Alt C Alt B-C Alt B-A Alt C-A
Year CF CF CF CF CF CF

0 -20000 -80000 -70000 -10000 -60000 -50000


1 7500 20000 17500 2500 12500 10000
2 7500 20000 17500 2500 12500 10000
3 7500 20000 17500 2500 12500 10000
4 7500 20000 17500 2500 12500 10000
5 7500 20000 17500 2500 12500 10000
6 7500 20000 17500 2500 12500 10000
7 7500 20000 17500 2500 12500 10000
8 7500 20000 17500 2500 12500 10000
9 7500 20000 17500 2500 12500 10000
10 17500 45000 39375 5625 27500 21875

NPV = 20113 26555 23236 3319 6442 3123


IRR = 36.7% 22.7% 22.7% 22.7% 17.6% 16.5%
ERR = 23.3% 18.3% 18.3% 18.3% 16.2% 15.7%

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