Refer to the data provided in Table 11.1 below to answer the following question(s).
Table 11.1 $$\begin{array}{l}
\begin{array} { l c c }
&\text { Total Investment }&\text {Expected Rate of Return }\
{ \text { Project } } & \text { (dollars) } & \text { (percentage) } \
\hline \text { New tablet computer for sales staff } & \$ 500,000 & 22 \
\text { Remodel for distribution center } & \$ 400,000 & 18 \
\text { On-site day care center } & \$ 200,000 & 10 \
\text { Employee fitness center } & \$ 100,000 & 8
\end{array}
\end{array}$$
-Refer to Table 11.1. If the interest rate is 20%, Nashbar Bicycle should

Question

Refer to the data provided in Table 11.1 below to answer the following question(s).
Table 11.1 $$\begin{array}{l}
\begin{array} { l c c } 
&\text { Total Investment }&\text {Expected Rate of Return }\
 { \text { Project } } & \text { (dollars) } & \text { (percentage) } \
\hline \text { New tablet computer for sales staff } & \$ 500,000 & 22 \
\text { Remodel for distribution center } & \$ 400,000 & 18 \
\text { On-site day care center } & \$ 200,000 & 10 \
\text { Employee fitness center } & \$ 100,000 & 8
\end{array}
\end{array}$$
-Refer to Table 11.1. If the interest rate is 20%, Nashbar Bicycle should

Quizplus · Accepted Answer

The correct choice is to fund only the purchase of new tablet computers for its sales staff because its expected rate of return (22%) is higher than the interest rate (20%), making it the only project with a positive net return.

Refer to the Data Provided in Table 11 -Refer to Table 11