An automaker is buying some special tools for $$100,000.$ The tools

are being depreciated by double declining balance depreciation using

a $4-$year depreciable life and a $$6250$ salvage value. It is expected

the tools will actually be kept in service for $6$ years and then sold for

$$6250.$ The before$-$tax benefit of owning the tools is as follows:

Year Before$-$Tax Cash Flow

$1$ $$30,000$

$230,000$

$335,000$

$440,000$

$510,000$

$610,000$

$6,250$ Selling price

Compute the after$-$tax rate of return for this investment situation,

assuming a $30\%$ incremental tax rate