Rainbow Painting Company is considering whether to purchase

Subject: Business    / Accounting
Question
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Rainbow Painting Company is considering whether to purchase a new spray paint machine that costs $8,000. The machine is expected reduce labor costs by $1,600 per year. The machine is expected to have a useful life of 10 years. The unadjusted rate of return for this investment is

a. 16%b. 20%c. 40%d. Some other amount.