What is the rate of return of the additional investment

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Reference no: EM131172330

Your state is considering purchasing a new snow plow of the options shown below. The state uses an MARR of 10%. List your answers for rates of return to 2 decimal places (XX.X%)

Option Cost Annual Benefit Salvage Life

Snow King $80,000 $14,600 $2,000 10

Snow Chump $40,000 $12,000 $1,000 5

a) What is the Rate of Return for each option?

b) What is the Rate of Return of the additional investment for the more expensive option?

c) Which snow plow do you recommend and why?

Reference no: EM131172330

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