Refer to the data provided in Table 11.3 below to answer the following question(s).
Table 11.3
Project Total Investment Expected Rate of Return
(dollars) (percentage)
$$\begin{array} { l l r }
\text { New computer for sales staff } & \$ 250,000 & 11 \
\text { Remodel for distribution center } & \$ 200,000 & 9 \
\text { On-site day care center } & \$ 100,000 & 5 \
\text { Employee fitness center } & \$ 50,000 & 4
\end{array}$$
-Refer to Table 11.3. If the interest rate is 10%, Blackstar Drone Manufacturing should

Question

Refer to the data provided in Table 11.3 below to answer the following question(s).
Table 11.3
Project Total Investment Expected Rate of Return
(dollars) (percentage)
 $$\begin{array} { l l r } 
\text { New computer for sales staff } & \$ 250,000 & 11 \
\text { Remodel for distribution center } & \$ 200,000 & 9 \
\text { On-site day care center } & \$ 100,000 & 5 \
\text { Employee fitness center } & \$ 50,000 & 4
\end{array}$$
-Refer to Table 11.3. If the interest rate is 10%, Blackstar Drone Manufacturing should

Quizplus · Accepted Answer

The correct choice is to fund only the purchase of new computers for its sales staff because this is the only project with an expected rate of return (11%) that is higher than the interest rate (10%). Projects with returns below the interest rate are not financially beneficial to pursue.

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