The company is considering purchasing an Cost Useful life (in years) Salvage value $3,000,000 8 $20,000 Estimated revenues and expenses: Revenues $2,500,000 Less expenses: Commissions Insurance Depreciation Maintenance $500,000 100,000 50,000 350,000 1,000,000 $1.500.000 NOI Required: 1) Assume that the payback must be 8 years of less. Would the company buy the asset? 2) Compute the simple ROR. The company requires a simple ROR of 15%. Should the asset be purchased? Amount Factor Present Value 2 The formula for the simple rate of return is