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Profissional Documentos
Cultura Documentos
and Management
( CE5007 )
Presentation on
MARR, Incremental Rate of Return, Present Worth
Comparison & Future Worth Comparison
Prepared by,
Divyanshu Shekhar BE/10290/2013
Akshay Deshmukh BE/10293/2013
Vivek P. Bhimani BE/10294/2013
Harshit Choudhary BE/10297/2013
TOPICS
M.A.R.R
Incremental
Present
Future
Rate of Return
Worth Comparison
Worth Comparison
Investment
Income
Profit
Rate
Of Return
TYPES
Minimum
Incremental
Rate of Return
M.A.R.R.
Minimum
MARR
Conditions
of Capital
Level
of competition
Example
Example
Option
1 ROR = 12.5%
Option
2 ROR = 11.875%
Option
3 = 10.5%
Option 4 = 16%
MARR = 15%
The company would choose not to invest
Example
YEAR
LEASE
BUY
DIFFERENCE
(BUY-LEASE)
-7000
-29000
-22000
-7000
-1500
5500
-7000
-1500
5500
-7000
-1500
5500
+15000 (RESALE
VALUE)
15000
13.3 %
Methods of Analysis
Two basic methods are used for present worth
analysis:
Toll Roads
Hotels
Commercial Buildings
Thank You!!