Swift Oil Company is considering investing in a new oil well. It is expected that the oil well will increase annual revenues by $140,120 and will increase annual expenses by $66,000 including depreciation. The oil well will cost $427,000 and will have a $9,000 salvage value at the end of its 10-year useful life. Calculate the annual rate of return. (Round answer to O decimal places, e.g. 13%.)

Swift Oil Company is considering investing in a new oil well. It is expected that the oil well will increase annual revenues by $140,120 and will increase annual expenses by $66,000 including depreciation. The oil well will cost $427,000 and will have a $9,000 salvage value at the end of its 10-year useful life. Calculate the annual rate of return. (Round answer to O decimal places, e.g. 13%.)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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