The Expected Average Rate of Return for a Proposed Investment

question 88

Multiple Choice

The expected average rate of return for a proposed investment of $900,000 in a fixed asset, with a useful life of five years, recognition is given to the effect of straight-line depreciation on the investment, no residual value, and an expected total net income of $360,000 for the 5 years, is:

• A) 18.5%.
• B) 40%.
• C) 12.5%.
• D) 16%.

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Definitions:

Immersion

The deep mental involvement or physical placement in a particular activity, culture, or environment, often for learning or experiential purposes.

Defensiveness

A psychological reaction characterized by a refusal to accept or consider criticism or uncomfortable truths about oneself, often as a mechanism to protect self-esteem.

Endogamy

The practice of marrying within a specific social group, caste, or ethnic group, rejecting those from others as inappropriate for marriage or other close relationships.

Legal Barriers

Laws or regulations that constitute obstacles to certain actions or changes.