8.5 You want to be richer. The second alternative generates greater value at any reasonable dis- count
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8.5 You want to be richer. The second alternative generates greater value at any reasonable dis- count rate. Other risk-free investments offer 7.5%. Therefore NPV -$1,000+ $4,000 1.075 +$2,721 NPV -$1,000,000+ $1,500,000 1.075 = +$395,349
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Related Book For
Fundamentals Of Corporate Finance
ISBN: 9780073382302
6th Edition
Authors: Richard A Brealey, Stewart C Myers, Alan J Marcus
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