Average rate of return, cash payback period, net present value method for a service company The St. Louis to Seattle Railroad is considering acquiring equipment at a cost of $3,600,000. The equipment has an estimated ife of 8 years and no residual value. It is expected to provide yearty net cash flows of $750,000. The company's minimum desired rate of reture for net present value analysis is 12% Present Value of an Annuity of $1 at Compound Interest Year 969 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.000 1.626 1.528 3 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3,037 2.855 2.589 S 4.212 3.791 3.605 3.353 2.991 6 4.917 4.355 4.111 3.785 3.326 7 5.582 4.065 4.564 4.160 3.605 " 6.210 5.335 4.958 4.487 3.837 9 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 Compute the following: a. The average rate of return, giving effect to straight-ane depreciation on the investment. Round to one decimal place. b. The cash payback period. Round to one decimal place. c. The net present value. Use the above table of the present value of an annuity of $1. Round to the nearest doller. Present value of annual net cash flows Amount to be invested Net present value