Question: The Pearce Club Inc is considering investing in an exercise

The Pearce Club, Inc., is considering investing in an exercise machine that costs $5,000 and would increase revenues by $1,500 a year for five years. The machine would be depreciated using the straight-line method over its useful life and have no salvage value.

Required
Use Excel to calculate the equipment’s internal rate of return. Assume that the tax rate is 30 percent. Round your answer to two decimals.


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  • CreatedMarch 11, 2015
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