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Pocket Pilot Inc. is considering an investment in new equipment that will be used to manufacture a mobile communications device. The device is expected to
Pocket Pilot Inc. is considering an investment in new equipment that will be used to manufacture a mobile communications device. The device is expected to generate additional annual sales of 6,000 units at $280 per unit. The equipment has a cost of $640,000, residual value of $50,000, and an 8-year life. The equipment can only be used to manufacture the device. The cost to manufacture the device is shown below. Determine the average rate of return on the equipment
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