Question
An investment promises to pay you $6,000 per year starting in 6 years. The cash flow from the investment is expected to increase by 4%
An investment promises to pay you $6,000 per year starting in 6 years. The cash flow from the investment is expected to increase by 4% per year forever. If alternative investments of similar risk earn a return of 11% per year, determine the maximum you would be willing to pay for this investment today.
Enter your response below (rounded to 2 decimal places).
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Analysis for Financial Management
Authors: Robert C. Higgins
10th edition
007803468X, 978-0078034688
