An Investment of $180 000 Yields Annual Net Returns of $27

question 66

Essay

An investment of $180 000 yields annual net returns of $27 700 for seven years. What is the rate of return on the investment (correct to the nearest tenth of a percent) if part of the initial investment, in the amount of, $80 000 is recovered at the end of 7 years?
a) Use linear interpolation to find the approximate value of the rate of return.
b) Find the answer using Cash Flow and IRR.

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Definitions:

Telematics

Technology of sending, receiving, and storing information via telecommunication devices to control remote objects, commonly used for vehicle tracking, fleet management, and insurance.

Employee Privacy

The rights of employees to have personal information, activities, and communications kept confidential from unauthorized disclosure or monitoring within the workplace.

Monitor

To observe, keep track of, or check for a specific purpose, often for progress or compliance.

Technology

The application of scientific knowledge for practical purposes, especially in industry.