Answered

Welcome to Westonci.ca, where your questions are met with accurate answers from a community of experts and enthusiasts. Ask your questions and receive accurate answers from professionals with extensive experience in various fields on our platform. Discover in-depth answers to your questions from a wide network of professionals on our user-friendly Q&A platform.

Hamell Company has gathered the following data on a proposed investment project: Discount rate 8% Life of the project 8 years Initial investment $330,000 Annual cash inflows 54,450 Salvage value 0 Assume that excess of incremental revenues over the incremental expenses (including depreciation) equal the annual cash inflows. The simple rate of return on the proposed investment is closest to: (Round your answer to 1 decimal place.)

Sagot :

Answer: 16.5%

Explanation:

Following the information given in the question, the simple rate of return on the proposed investment will be calculated thus:

= Annual cash flow / Initial investment

= $54,450 / $330,000

= 0.165

= 16.5%

Therefore, the simple rate of return on the proposed investment is 16.5%.

We hope you found what you were looking for. Feel free to revisit us for more answers and updated information. We hope this was helpful. Please come back whenever you need more information or answers to your queries. Westonci.ca is here to provide the answers you seek. Return often for more expert solutions.