In the Rawhide Company (a leather products manufacturer), decisions regarding approval of proposals for capital investment are based upon a stipulated MARR of 18% per year. The five packaging devices listed in the table below were compared assuming a 10 year useful life and zero market value for each at that time. Which one (if any) should be selected? Use the IRR and PW method.







Packaging Equipment



Packaging Equipment



Packaging Equipment



Packaging Equipment



Packaging Equipment








A




B




C




D




E






Capital Investment




$38,000




$50,000




$55,000




$60,000




$70,000






Annual revenue less expenses




$11,000




$14,100




$16,300




$16,800




$19,200






Rate of return (IRR)




26.1%




25.3%




26.9%




25.0%




24.3%