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+--- Thread: Question,Calculating Average Rate of Return (/thread-question-calculating-average-rate-of-return)
Question,Calculating Average Rate of Return - princeeagel - 01-08-2010
Investmnt 4 machine=$14000
salvage value=$6000 after 5 years
Annual Average profits=$800
find Average Rate of Return?
Show all steps in calculation...
- aamalik - 01-23-2010
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by princeeagel</i>
<br />Investmnt 4 machine=$14000
salvage value=$6000 after 5 years
Annual Average profits=$800
find Average Rate of Return?
Show all steps in calculation...
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
Interest rate should have been mentioned, anyway
cumulative profit ------ 5*800 = $ 4000
salvage value ------------------ $ 6000
total value -------------------- $ 10000
average yearly return ---------- $ 2000
average pa rate ---------------- 2000/14000*100 = 14.29%