a) What is the cash payback period for this proposal? (round to 2 decimal places)

b) What is the annual rate of return for the investment? (round to 2 decimal places)

Drake Corporation is reviewing an investment proposal. The initial cost is $105,700. Estimates of the book value of the investment at the end of each year, the net cash flows for each year, and the net income for each year are presented in the schedule below. All cash flows are assumed to take place at the end of the year. The salvage value of the investment at the end of each year is assumed to equal its book value. There would be no salvage value at the end of the investment's life. Investment Proposal Annual Book Value Cash Flows $70,500 $44,900 Year Annual Net Income 1 $9.700 2 42,400 39,200 11.100 3 20,600 36,000 14.200 4 6800 29.100 15,300 5 0 25.205 18.405 Drake Corporation esa 11% target rate of return for new investment proposal Click here to www the factor table