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An investment requires 35,000 today, and produces an yearly cash flow of 3000 in perpetuity. Cash flow is expected to grow at 3% a year.

An investment requires 35,000 today, and produces an yearly cash flow of 3000 in perpetuity. Cash flow is expected to grow at 3% a year.

a.What is the NPV of this investment if the discount rate is 8%?

b.What is the rate of return of this investment?

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