Chad’s Chocolates is considering the purchase of a new candy press. The machine under consideration costs $17,550 and would generate $2,650 in annual savings of direct labor costs over its 20-year...

Chad’s Chocolates is considering the purchase of a new candy press. The machine under consideration costs $17,550 and would generate $2,650 in annual savings of direct labor costs over its 20-year life. At the end of 20 years, the press could be sold for $500. Chad’s required rate of return is 16%. Which of these rates is the machine’s internal rate of return closest to?

a. 11%

b. 12%

c. 14%

d. 16%