question archive Alternative Initial investment (TL) Alternative IRR(%) Incremental IRR (%), when compared with alternative A B C D E A 25,000 9
Alternative Initial investment (TL) Alternative IRR(%) Incremental IRR (%), when compared with alternative A B C D E A 25,000 9
Subject:FinancePrice: Bought3
|
Alternative |
Initial investment (TL) |
Alternative IRR(%) |
Incremental IRR (%), when compared with alternative |
||||||
|
A |
B |
C |
D |
E |
|||||
|
A |
25,000 |
9.6 |
….. |
28.9 |
19.7 |
36.7 |
25.5 |
||
|
B |
35,000 |
15.1 |
|
….. |
1.5 |
39.8 |
24.7 |
||
|
C |
40,000 |
13.4 |
|
|
…. |
49.4 |
28.0 |
||
|
D |
60,000 |
25.4 |
|
|
|
…. |
-0.6 |
||
|
E |
75,000 |
20.2 |
|
|
|
|
….. |
||
Examples of how to read this table: the IRR of project A is 9.6% and the IRR of the incremental investment project when project A is compared to project B is 28.9%.
- If the alternatives are independent and the MARR is 18%, which alternative(s) should be selected? Explain your answer.
