Sigma Company is considering a new investment that costs $700,000, has a 10 year life and no salvage value. Below is an income statement related to the investments estimated annual revenues and expenses.

Sales $515,000

Variable Expenses 230,000

Contribution Margin $285,000

Fixed Expenses

Out of pocket cash expenses $125,000

Depreciation 70,000 195,000

Net operating income $ 90,000

The simple rate of return for this investment is closest to: