Sheridan Inc. is considering modernizing its production facility by investing in new equipment and selling the old equipment. The following information has been collected on this investment: Depreciation is $10,000 per year for the old equipment. The straight-line depreciation method would be used for the new equipment over an eight-year period with salvage value of $4,400. (b) Your answer is incorrect. Calculate the annual rate of return. (Round answer to 2 decimal places, eg. 15.25\%.)