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Exercise 12-8
Pierre’s Hair Salon is considering opening a new location in French Lick, California. The cost of
building a new salon is $319,000. A new salon will normally generate annual revenues of
$68,243, with annual expenses (including depreciation) of $40,600. At the end of 15 years the
salon will have a salvage value of $75,900.
Calculate the annual rate of return on the project. (Round answer to 0 decimal places, e.g. 125.)
Annual rate of return
%
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