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Determine the unadjusted rate of return

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Reference no: EM132801880

Question - Eddy Company has an opportunity to purchase an asset that will cost the company $25,000. The asset is expected to add $7,500 per year to the company's net income. Assuming the asset has a five-year useful life and zero salvage value, determine the unadjusted rate of return?

a. 3%.

b. 10%.

c. 30%.

d. 20%.

Reference no: EM132801880

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