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Macaron Pizzeria is considering expanding operations by establishing a delivery business. This will require the purchase of an oven that will cost $52,000, including installation.

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Macaron Pizzeria is considering expanding operations by establishing a delivery business. This will require the purchase of an oven that will cost $52,000, including installation. The oven is expected to last five years, have a $5.200 residual value and will be depreciated using the straight-line method. Cash flows associated with the delivery business are as follows: Item Revenue Ingredients Salary Additional misc Residual value Year 1 $67.600 (26,104) (25,896) (2.184 Year 2 $68,952 (28,704) (271.976 (2.392 Year 3 $81,364 137610 (30.056 12.6091 Year 4 $91.520 134,781 182.136) (2,808 Year 5 $99,050 138.164) (34,112) 12.912 5,200 In addition to the above, there are tax consequences related to the new business, and the company's tax rate is 20 percent Click here to vid torturs. Calculate the internal rate of return for the delivery business. (Hint: Try a range of rates between 14 percent and 16 percent.) (Round present valse factor calculations to 4 decimal places, eg, 1.2151 and final answer to decimal places, eg 18%) The internal rate of return Should Macaron Pizzeria invest in the delivery business if the required rate of return is 10 percent? Macaron Pizzeria invest in the delivery business

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