Hampton Savings Bank is considering the establishment of a new branch office at the corner of…

Hampton Savings Bank is considering the establishment of a new branch office at the corner of Queen Street and Victoria Boulevard. The savings association’s economics department projects annual operating revenues of $1.6 million from fee income generated by service sales and annual branch operating expenses of $795,000. The cost of procuring the property is $1.75 million and branch construction will total an estimated $2.65 million; the facility is expected to last 16 years. If the savings bank has a minimum acceptable rate of return on its invested capital of 12 percent, will Hampton savings likely proceed with this branch office project?