Determine the projected after-tax rate of return

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A corporation expects to receive $32,000 each year for 15 years from the sale of a product. There will be an initial investment of $150,000. Manufacturing and sales expenses will be $8067 per year. Assume straight-line depreciation, a 15-year useful life and no salvage value. Use a 46% income tax rate. Determine the projected after-tax rate of return.

1. 148%

2. 12%

3. 8%

4. 22%

Reference no: EM13834769

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