(Solved):Why is an incremental analysis necessary when conducting a rate of return evaluation of two or…

 

Question

Why is an incremental analysis necessary when conducting a rate of return evaluation of two or more cost alternatives? Briefly, explain your answer and include an example.

 

EXPERT ANSWER

Incremental analysis is necessary while comparing the rate of return from two or more alternatives, as this is the method used in an organization to evaluate the real cost and benefit differences from various options. This analysis does not take the cost, which

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