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Question
The Boyer Bank wants to add a new ATM machine in a busy mall. It knows the new machine will cost $60,000 and another $30,000 is required to install it in the mall. It expects to save $0.27 per transaction and generate 100,000 transactions per year. Also, it expects the new machine to last 8 years. What is the expected rate of return or internal rate or return of this project?
A. 25%
B. 3.3%
C. 30%
D. 12%
E. 2.4%
Answer
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