Livewire is a technology company that reported a pre-tax operating loss in the most recent year of $10 million, after expensing R&D expenses of $30 million during the year. The company reported invested capital of $40 million at the end of the most recent year. You are told that the R&D typically takes 3 years to pay off in this business, and that Livewire had R& D expenses of $24 million, $18 million and $12 million in each of the last 3 years. Assuming that you decide to capitalize R&D expenses, what is the pre-tax return on capital for Livewire?

2.17%

5.00%

10.87%

43.48%

None of the above