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(a) The heat loss through the exterior walls of a processing plant is estimated to cost the owner RM3000 next year. A salesman from
(a) The heat loss through the exterior walls of a processing plant is estimated to cost the owner RM3000 next year. A salesman from Flextronic claims he can reduce the heat loss by 80% with the installation of RM5000 of Superfiber now. If the cost of heat loss rises by RM200 per year, after next year (gradient), and the owner plans to keep the building ten more years, what is his rate of return, neglecting depreciation and taxes?
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