Steemers, Inc. is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over its useful life with no salvage value. Steemers requires a 15% rate of return. Present Value of an Annuity of 1 Period 9% 10% 11% 12% 15% 6 4.486 4.355 4.231 4.111 3.784 What are the approximate internal rate of return of this investment? Because of rounding, answers will differ slightly based on whether excel is used to determine the answer or the present value tables are used. Choose the answer that is closest to the answer you calculated.

Steemers, Inc. is considering purchasing equipment costing $60,000 with a 6-year useful life. The equipment will provide cost savings of $14,600 and will be depreciated straight-line over its useful life with no salvage value. Steemers requires a 15% rate of return.

Present Value of an Annuity of 1

Period 9% 10% 11% 12% 15%

6 4.486 4.355 4.231 4.111 3.784

What are the approximate internal rate of return of this investment?

Because of rounding, answers will differ slightly based on whether excel is used to determine the answer or the present value tables are used. Choose the answer that is closest to the answer you calculated.

15%

12%

3.784%

10%

34%