Assume a Machine Which Has a Useful Life of Only

question 166

Multiple Choice

Assume a machine which has a useful life of only one year costs $2,000.Assume, also, that net of such operating costs as power, taxes, and so forth, the additional revenue from the output of this machine is expected to be $2,300.The expected rate of return on this machine is:

• A)7.5 percent.
• B)10 percent.
• C)15 percent.
• D)20 percent.

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Definitions:

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