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2. You are considering investing in a start-up company. The founder asked you for $200,000, today and you expect to get $1,000,000 in nine years.
2. You are considering investing in a start-up company. The founder asked you for $200,000, today and you expect to get $1,000,000 in nine years. Given the riskiness of the investment opport nay, your cost ofcapital is 20%. What is the NPV of the investment opportunity? Should undertake the investment opportunity? Calculate the IRR and use it to determine the m mum deviation allowable in the cost of capital estimare to leave the decision unchanged you
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