Shields Company has gathered the following data on a proposed investment project: (Ignore income taxes.)

Investment required in equpiment = $400,000

Annual cash inflows = $80,000

Salvage Value = $0

Life of the investment = 10 years

Discount rate = 10%

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Part A) The simple rate of return on the investment is closest to:

a. 10%

b. 20%

c. 15%

d. 5%

Part B) The net present value on this investment is closest to:

a. $76,750

b. $400,000

c. $91,600

d. $80,000

Part C) The internal rate of return on the investment is closest to:

a. 13%

b. 15%

c. 11%

d. 17%