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Investments: The Rate of Return

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What is the rate of return on an investment over it's economic life that costs $29,000 and has a $1000 salvage value after 7 years(straight line depreciation) if it can earn $6,000 before taxes annually? Assumes that you are in a 25% tax bracket.

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1- What is the rate of return on an investment over it's economic life that costs $29,000 and has a $1000 salvage value after 7 years
(straight line depreciation) if it can earn $6,000 before taxes annually? Assumes that you are in a 25% tax bracket.

Please note: Assumption made: It is ...

Solution Summary

This solution finds the rate of return for an investment that earns $6,000 before taxes annually.

$2.19