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ABC Real Estate Corporation is considering three investment alternatives for a new real estate development project in a growing urban area. The company is evaluating
ABC Real Estate Corporation is considering three investment alternatives for a new real estate development project in a growing urban area. The company is evaluating the construction of office buildings, residential apartments, and retail spaces. Each alternative requires an initial investment of $ million. The cash flows for each alternative are as follows:
Office Buildings: Year : $ Year : $ Year : $ Year : $ Year : $
Residential Apartments: Year : $ Year : $ Year : $ Year : $ Year : $
Retail Spaces: Year : $ Year : $ Year : $ Year : $ Year : $
The company's cost of capital is
Calculate the Net Present Value NPV for each investment alternative.
Construct the NPV profile for the three investment alternatives.
Analyze the NPV profile to determine the most financially attractive investment option for ABC Real Estate Corporation.
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