Homework answers / question archive / Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes

Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes

Accounting

Share With

Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.):

Investment required in equipment$40,000 Annual cash inflows $10,000 Salvage value of equipment$0 Life of the investment 15yearsRequired rate of return 10%

The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment.

The simple rate of return for the investment (rounded to the nearest tenth of a percent) is: