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2) (9 pts) Demand for investment, user cost of capital and market value of capital Joe is a corn farmer who currently owns K acres

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2) (9 pts) Demand for investment, user cost of capital and market value of capital Joe is a corn farmer who currently owns K acres of land. Joe is considering a purchase of If: additional acres of land at the current market price of P per acre. Next period, Joe will be able to grow and sell 2001: + icy/2 dollars worth of corn. Next period's price of land is P' per acre. Accordingly1 Joe's present value of economic prot is 1 Pk+ (20-(K+k)2 +P'-(K+k)) 1+1"

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