Sheffield Corporation is involved in the business of injection moulding of plastics. It is considering the purchase of a new computer aided design and manufacturing machine for $445,300. The company believes that with this new machine it will improve productivity and increase quality, resulting in a $111,500 increase in net annual cash flows for the next five years. Management requires a 10% rate of return on all new investments.

Click here to view the factor table.

Calculate the internal rate of return on this new machine. (Round answer to O decimal places, e.g. 10%. For calculation purposes, use 5 decimal places as displayed in the factor table provided, e.g. 1.52124.)

Internal rate of return

%