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Suppose Franny Dip's Sweets is considering investing in warehouse-management software that costs $450,000, has $35,000 residual value, and should lead to cost savings of $130,000

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Suppose Franny Dip's Sweets is considering investing in warehouse-management software that costs $450,000, has $35,000 residual value, and should lead to cost savings of $130,000 per year for its five-year life. In calculating the ARR, which of the following figures should be used as the equation's denominator (average amount invested in the asset)? A. $242,500 B. $225,000 C. $207,500 D. $485,000

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