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castortr0y [4]
2 years ago
6

The expected average rate of return for a proposed investment of $4,250,000 in a fixed asset, using straight-line depreciation,

with a useful life of 20 years, no residual value, and an expected total net income of $8,500,000 over the 20 years is:_________ (round to two decimal points).
a. 10.00%
b. 20.00%
c. 40.00%
d. 1.00%
Business
1 answer:
Sphinxa [80]2 years ago
4 0

Answer:

A

Explanation:

Average rate of return is a capital budgeting method. It is used to determine if a firm should invest in a project or should not invest in a project

average rate of return = average net income / average cost of investment

average net income = (total net income - depreciation) / useful life

(8,500,000 - $4,250,000) / 20 = 212,500

Average cost of investment =( beginning book value of the investment - ending book value of the investment) / 2

($4,250,000 - 0) / 2 = 2,125,000

ARR = 212,500 / 2125,000 = 0.1  = 10%

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Answer:

The correct answer is 11.28%

Explanation:

Solution

Recall that:

                                          Investment center A    Investment center B

Investment center income    $ 530,000                $ 640,000

Investment center average

invested assets                     $ 4,700,000                $ 3,100,000

Now,

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The ROI A=Investment center income/Average invested assets  which is

= (530000/4,700,000)

=11.28%

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3 years ago
Tell whether the statement is TRUE or FALSE. Deregulation always leads to lower prices for the consumer.
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If an insured is concerned about being unable to pay the premiums on his or her whole life policy in the event of a total disabi
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Answer:

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Because in the case of this question the insured is concerned about becoming disable and losing the ability to pay for the contract, he is likely to benefit from a waiver of premium included in his insurance contract.

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brainly.com/question/17203768

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1 year ago
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