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Nick's Novelties, Incorporated, is considering the purchase of new electronic games to place in its amusement houses. The games would cost a total of $225,000,

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Nick's Novelties, Incorporated, is considering the purchase of new electronic games to place in its amusement houses. The games would cost a total of $225,000, have a fifteen-year useful life, and have a total salvage value of $22,500. The company estimates that annual revenues and expenses associated with the games would be as follows: 2a. Compute the simple rate of return promised by the games. 2 b. If the company requires a simple rate of return of at least 13%, will the games be purchased? Compute the simple rate of return promised by the games. (Round your answer to 1 decimal place. I.e. 0.12 considered as 12.3%.)

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