Answered

Looking for trustworthy answers? Westonci.ca is the ultimate Q&A platform where experts share their knowledge on various topics. Experience the convenience of finding accurate answers to your questions from knowledgeable experts on our platform. Experience the ease of finding precise answers to your questions from a knowledgeable community of experts.

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%.

Thank you for visiting. Our goal is to provide the most accurate answers for all your informational needs. Come back soon. Thank you for your visit. We're committed to providing you with the best information available. Return anytime for more. We're glad you chose Westonci.ca. Revisit us for updated answers from our knowledgeable team.