MCA Corporation is reviewing an investment proposal. The schedule below presents the initial cost and estimates of the book value of the investment at the end of each year, the net cash flows for each year, and the net income for each year. All cash flows are assumed to take place at the end of the year. The investments salvage value at the end of each year is equal to its book value. There would be no salvage value at the end of the investments life.

Investment Proposal
Year		Initial Cost and Book Value			Annual Cash Flows			Annual Net Income
0		$104,500
1		70,200			$51,000			$14,800
2		41,300			45,800			16,900
3		20,500			40,600			19,000
4		9,000			34,500			20,900
5		0			29,200			23,600

MCA Corporation uses a 15% target rate of return for new investment proposals.

1. find cash back period in years?

2. find annual rate of return in %?