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A project has a cost of $6000. The project will have a payout of X at the end of the first year. This initial payout
A project has a cost of $6000. The project will have a payout of X at the end of the first year. This initial payout X will grow at the rate of 10% per year for the next 2 years, then by 8% per year for the next year, and then at the rate of 5% per year for the following 3 years. You believe the riskiness of this investment is 9%.
A: Use Goal Seek or Solver to determine level of riskiness that would yield a net present value of $2500 if the initial payment is $1500.
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