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RL Enterprises wants to buy a machine that costs $420,000, has a 20-year life, and has no salvage value. Annual inflows are $210,000 and annual
RL Enterprises wants to buy a machine that costs $420,000, has a 20-year life, and has no salvage value. Annual inflows are $210,000 and annual outflows are $160,000. If RL uses the straight-line method to compute depreciation, what is the annual rate of return on this purchase?
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A :
13.81%
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B :
9.34%
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C :
18.13%
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D :
6.90%
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