Blaine Corporation is considering replacing a technologically obsolete machine with a new state of the art numerically controlled machine The new machine would cost $180,000 and would have a ten year useful life Unfortunately, the new machine would have no salvage value The new machine would cost $12,000 per year to operate and maintain, but would save $48,000 per year in labor and other costs The old machine can be sold now for scrap for $20,000 What is the simple rate of return on the new machine (round off your answer to the nearest one hundredth of a percent) a) 10 00 b) 26 67 c) 22 50 d) 11 25

Question: Blaine Corporation is considering replacing a technologically obsolete machine with a new state-of-the-art numerically controlled machine. The new machine would cost $180,000 and would have

Blaine is considering replacing a technologically obsolete machine with a new state-of-the-art numerically controlled machine. The new machine would cost $180,000 and would have a ten-year useful life. Unfortunately, the new machine would have no . The new machine would cost $12,000 per year to operate and maintain, but would save $48,000 per year in labor and other costs. The old machine can be sold now for scrap for $20,000. What is the simple rate of return on the new machine (round off your answer to the nearest one-hundredth of a percent)?
a) 10.00%
b) 26.67%
c) 22.50%
d) 11.25%

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