(Ignore income taxes in this problem.) Overland Corporation has gathered the following data on a proposed investment project:

Investment required in equipment	$	680,000
Annual cash inflows	$	56,000
Salvage value of equipment	$	0
Life of the investment		20	years
Required rate of return		7	%

The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment.

The simple rate of return on the investment is: (Round your answer to the nearest interest rate.)

3%

4%

5%

8%