If a $1 million project can be financed at 12 percent per year and will have a 15 percent rate of return per year,its annual profit will be

Question

Quizplus · Accepted Answer

The annual profit is calculated by subtracting the cost of financing from the return. The project returns 15% of $1 million, which is $150,000, and the cost of financing is 12% of $1 million, which is $120,000. The profit is $150,000 - $120,000 = $30,000.

If a $1 Million Project Can Be Financed at 12