Using the assumptions of exercise 9.26, provide inflation-adjusted figures for Exhibit 9.1. a. Compute the real discount

Question:

Using the assumptions of exercise 9.26, provide inflation-adjusted figures for Exhibit 9.1.

a. Compute the real discount rate if the nominal discount rate is 10 percent.

b. Discount the inflation-adjusted unlevered cash flows of the hydrogenerator at the real discount rate to obtain their present value.

AppendixLO1

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Financial Markets And Corporate Strategy

ISBN: 9780077119027

1st Edition

Authors: David Hillier, Mark Grinblatt, Sheridan Titman

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