What is the annual rate of return on the investment

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Problem 1: A Company projects an increase in net income of $108000 each year for the next five years if it invests $900000 in new equipment. The equipment has a 5-year life and an estimated salvage value of $300000. What is the annual rate of return on this investment?

Option 1: 12.0%
Option 2: 18.0%
Option 3: 30.0%
Option 4: 36.8%

Reference no: EM132877433

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