Assume the following information for a capital budgeting proposal with a five-year time horizon:

Initial investment:
Cost of equipment (zero salvage value)	$	470,000
Annual revenues and costs:
Sales revenues	$	300,000
Variable expenses	$	130,000
Depreciation expense	$	50,000
Fixed out-of-pocket costs	$	40,000

This proposals simple rate of return is closest to:

Multiple Choice

• 19%.

• 17%.

• 28%.

• 9%.