The Monarch Division of Allgood Corporation has a current ROI of 14 percent. The company...
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The Monarch Division of Allgood Corporation has a current ROI of 14 percent. The company target ROI is 10 percent. The Monarch Division has an opportunity to invest $5,400,000 at 12 percent but is reluctant to do so because its ROI wil fall to 13.20 percent. The present investment base for the division is $8,100,000. Required a. Calculate the curtent residual income and the residual income with the new investment opportunty being included. b. Based on your answers to requirement a, should Monarch Division make the investment
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