Gorman Inc. has invested $140,000 in a new machine, which is expected to save $28,400 cash...
Gorman Inc. has invested $140,000 in a new machine, which is expected to save $28,400 cash per year over its estimated life of 10 years. What do they expect as the time-adjusted rate of return, to the nearest .5%?
Homework Answers
Calculating Rate of Return,
using TVM Calculation,
I = [PV = -140,000, PMT = 28,400, N = 10, FV = 0]
I = 15.47%
So,
Rate of Return = 15.47%
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