Computing the equipment internal rate of return

Reference no: EM13151757

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

Calculate the equipment's internal rate of return. Assume that the tax rate is 30 percent.

Reference no: EM13151757

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