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Average Rate of Return The following data are accumulated by Watershed Inc. in evaluating two competing capital investment proposals: Project A Project Z Amount of

Average Rate of Return

The following data are accumulated by Watershed Inc. in evaluating two competing capital investment proposals:

Project A Project Z
Amount of investment $88,000 $88,000
Useful life 4 years 5 years
Estimated residual value 0 0
Estimated total income over the useful life $10,560 $20,900

Determine the expected average rate of return for each project. Round your answers to one decimal place.

Project A %
Project Z %

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