What is the residual income of the new project

Reference no: EM13163417

A company's current net operating income is $16,800 and its average operating assets are $80,000. The company's required rate of return is 18%.

A new project being considered would require an investment of $15,000 and would generate annual net operating income of $3,000. What is the residual income of the new project?

A) 20.8% B) 20% C) ($150) D) $300

Reference no: EM13163417

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