chap 26 #2

Average Rate of Return

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

	3D Printer		Truck
Amount of investment	$36,000			$64,000
Useful life	4 years			5 years
Estimated residual value	0			0
Estimated total income over the useful life	$3,240			$12,000

Determine the expected average rate of return for each proposal. If required, round your answers to one decimal place.

3D Printer	%
Truck	%