The Expected Average Rate of Return for a Proposed Investment

question 4

Multiple Choice

The expected average rate of return for a proposed investment of $800,000 in a fixed asset with a useful life of 4 years,straight-line depreciation,no residual value,and an expected total net income of $360,000 for the 4 years,is

• A) 45%
• B) 22.5%
• C) 11.3%
• D) 5.5%

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Definitions:

Hysteria

An outdated term for a psychological disorder characterized by conversion of psychological stress into physical symptoms.

Melancholia

A severe form of depression with classic symptoms of despair, deep sadness, inability to find joy, and withdrawal.

Epilepsy

A neurological disorder marked by sudden recurrent episodes of sensory disturbance, loss of consciousness, or convulsions, associated with abnormal electrical activity in the brain.

Brain Fever

An antiquated term for various conditions that would inflame the brain, such as encephalitis or meningitis, but not used in modern medical practice.