Micro Tek Inc. is considering an investment in new equipment that will be used to manufacture a smartphone. The phone is expected to generate additional annual sales of 6,500 units at $298 per unit. The equipment has a cost of $725,400, residual value of $54,600, and an eight-year life. The equipment can only be used to manufacture the phone. The cost to manufacture the phone follows:

Cost per unit:
	Direct labor		$50.00
	Direct materials		193.00
	Factory overhead (including depreciation)		33.40
		Total cost per unit	$276.40

Determine the average rate of return on the equipment. If required, round to the nearest whole percent. fill in the blank 1 %