Claire Designs is looking at a new computer-assisted drafting system. The system costs $125,000 and would generate an annual $33,000 in savings of operating costs over its 12-year life. At the end of the 12 years, the system could be sold for $15,000. The company uses a 16% discount rate. The system's accounting rate of return is closest to:

(a) 16% (b) 17% (c) 18% (d) 19%

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