Answer: b) Select the preferred investment.
Explanation:
The seven-step systematic economic analysis technique (SEAT) are:
• Identifying investment alternatives
• Defining planning horizon
• Specifying discount rates
• Estimating cash flows
• Comparing alternatives
• Performing supplementary analysis
• Selecting preferred investment.
It should be noted that selecting preferred investment is the final stage and at this stage, many factors have to be considered before a final decision is made. To maximize the the present worth, multiple criteria are taken into consideration rather than a single criteria.
Therefore, select the preferred investment is the correct answer.
