Compared by incremental rate of return analysis

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Reference no: EM131514974

A chemical engineer working for a large chemical products company was asked to make a recommendation about which of three mutually exclusive revenue alternatives should be selected for improving the marketability of personal care products used for conditioning hair, cleansing skin, removing wrinkles, etc. The alternatives (X, Y, and Z) were ranked in order of increasing initial investment and then compared by incremental rate of return analysis. The rate of return on each increment of investment was less than the company’s MARR of 17% per year. The alternative to select is:

a. DN

b. alternative X

c. alternative Y

d. alternative Z

Please explain your answer

Reference no: EM131514974

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