Standard Media has a required rate of return of 5 percent, a cost of capital of 4 percent, and an income tax rate of 30 percent. The following information about its two divisions has been provided by management:
NOPAT = $1,400,000 (Audio Division), $2,000,000 (Video Division)
Sales = $10,000,000 (Audio Division), $12,500,000 (Video Division)
Invested capital = $15,000,000 (Audio Division), $17,500,000 (Video Division)
How much is the ROI of the Audio Division?
A. 9.33%
B. 66.67%
C. 14.00%
D.16.00%