Question: A growing chain is trying to decide which store location to open. The first location ( A ) requires a $ 5 0 0 ,

A growing chain is trying to decide which store location to open. The first location (A) requires a $500,000 investment in average assets and is expected to yield annual income of $80,000. The second location (B) requires a $200,000 investment in average assets and is expected to yield annual income of $42,000.
(1) Compute the expected return on investment for each location.
(2) Using return on investment, which location (A or B) should the company open?

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