A little construction prayer (class of three years) bought a used pick-up truck for $22,000. He plans to use it for 4 years and then sell it for $5,000. Annual revenue is estimated at $8,000 and the equipment will be depreciated using MACRS. The percentage of income tax that applies to the company is 30%. How much is the internal return ratio (IRR) after paying taxes?
a. 16.40%
b. None of the above
c. 15.47%
d. 14.10%
e. 18.54%
