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Your company has been presented with an opportunity to invest in a project that is summarized as follows: Investment required: $ 60,000,000 Annual gross income:
Your company has been presented with an opportunity to invest in a project that is summarized as follows:
Investment required: $ 60,000,000
Annual gross income: $ 14, 000,000
Annual operating Costs: 5,500,000
Salvage Value after 10 years: 0
The project is expected to operate as shown for 10 years. If your management requires a return of 10% on its investments before taxes, would you recommend this project based on rate of return analysis?
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