Lakeland Company is considering the purchase of equipment for \($175,000.\) The equipment will expand the company’s production and increase revenue by \($40,000\) per year. Annual cash operating expenses will increase by \($12,000.\) The equipment’s useful life is 10 years with no salvage value. Lakeland uses straight-line depreciation. The income tax rate is 25%. What is the average rate of return on the investment?