ROR Analysis – Multiple Alternatives using CC (Capital Cost= P=A/i)
(1) Order alternatives from smallest to largest initial investment
(3) Determine incremental CF between defender and next lowest-cost alternative
(4) Calculate ∆i* on incremental CF between two alternatives from step (3)
(5) If ∆i* ≥ MARR, eliminate defender and challenger becomes new defender
against next alternative on list