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1 - You own a gas pipeline that requires no maintenance and will produce $ 2 million of revenue next year. Unfortunately, after the first
You own a gas pipeline that requires no maintenance and will produce $ million of revenue next year. Unfortunately, after the first year, the volume of gas and thus the revenue is expected to decline by per year.
a If the discount rate is and the pipeline lasts forever, what is it worth today?
b If the pipeline is to be abandoned at the end of years, what is it worth today?
I only need answer to part b
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