What is internal rate of return on incremental investment

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Reference no: EM131541160

Are you thinking of bypassing a gasoline fueled car in favor of a hybrid? (gasoline and? electric) automobile?? Let's take a look at the relative economics of your possible choice. The? gasoline-fueled car sells for ?$20,000 and gets 25 miles per gallon? (mpg) of fuel. The alternative hybrid vehicle sells for ?$25,000 and averages 49.2 mpg. The resale value of the hybrid car is ?$2,500 more than that of the? gasoline-only car after five years of anticipated ownership. If you drive 15,000 miles per year and gasoline costs ?$3.50 per? gallon, what is the internal rate of return on the incremental investment in the hybrid? automobile?

Reference no: EM131541160

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