Solution: What is the approximate rate of return (ROR) on the investment?

A small machine has an initial cost of P20,000, a salvage value of P2,000 and a life of 10 years. If your cost of operation per year is P3,500 and your revenues per year is P9,000, what is the approximate rate of return (ROR) on the investment?

What is the approximate rate of return (ROR) on the investment?

Problem Statement: EE Board April 1997

A small machine has an initial cost of P20,000, a salvage value of P2,000 and a life of 10 years. If your cost of operation per year is P3,500 and your revenues per year is P9,000, what is the approximate rate of return (ROR) on the investment?

  • A. 24.2%
  • B. 24.8%
  • C. 25.1%
  • D. 25.4%

Problem Answer:

The approximate rate of return (ROR) on the investment is 24.8%.

Solution:

Latest Problem Solving in Engineering Economics (Annuity, Depreciation, Bonds, Breakeven, etc.)

More Questions in: Engineering Economics (Annuity, Depreciation, Bonds, Breakeven, etc.)

Online Questions and Answers in Engineering Economics (Annuity, Depreciation, Bonds, Breakeven, etc.)


Search! Type it and Hit Enter


We educate thousands of students a week in preparation for their licensure examinations. We provide professionals with materials for their lectures and practice exams. To help us go forward with the same spirit, contribution from your side will highly appreciated. Thank you in advance.


Post a Comment

Contact Form

Name

Email *

Message *

Powered by Blogger.
Javascript DisablePlease Enable Javascript To See All Widget
Real Time Web Analytics