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Question 9.P.1: The management of the Conway Corporation is considering five......

The management of the Conway Corporation is considering five alternative new-product proposals that their employees have submitted to them:

\begin{matrix} \text{Proposal} & \text{Rate of Return} \\ \text{Fryer} & 49\% \\ \text{Box Loader} & 26\% \\ \text{Conveyor} & 19.5\% \\ \text{Planer} & 23\% \\ \text{Cutter-Loader} & 26.5\% \end{matrix}

Conway currently enjoys an average return of 260h on total investment. Which proposal(s) is (are) acceptable?

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Using the current average return on total investment as the MARR, only Fryer and Cutter-Loader are strictly acceptable. If the rule is: ROR ≥ MARR, then Box Loader is also acceptable.

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