Norman Rentals can purchase a van that costs $200,000; it has an expected useful life of five years and no salvage value. Norman uses straight-line depreciation. Expected revenue is $72,300 per year. Assume that depreciation is the only expense associated with this investment.

Required

a.

Determine the payback period. (Round your answer to 1 decimal place.)

Payback period

b.

Determine the unadjusted rate of return based on the average cost of the investment. (Round your answer to 1 decimal place. (i.e., .234 should be entered as 23.4).)

	Unadjusted rate of return