AT IRR should be 10.5%

12-16 ACDC Company is considering the installation of a new machine that costs $150,000. The machine is expected to lead to net income of $44,000 per year for the next 5 years. Using straight-line depreciation, $0 salvage value, and an effective income tax rate of 28%, determine the after-tax rate of return for this investment. If the company's after-tax MARR rate is 12%, would this be a good investment or not? Contributed by Mukasa Ssemakula, Wayne State University