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An investor buys a building for $250,000 cash and leases it for payments of: Year 1 $50,000 Year 2 $60,000 Year 3 $70,000 . .

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An investor buys a building for $250,000 cash and leases it for payments of: Year 1 $50,000 Year 2 $60,000 Year 3 $70,000 . . At the end of Year 3, the building will be sold for $300,000 in net sales proceeds. Similar investments yield a 12% return. (Questions 17-18) 17. What is the net present value (NPV)? a. $55,833.18 b. $105,833.18 c. $145,875.48 d. $248,189.23 18. What is the internal rate of return (IRR)? a) 11.25% b) 14.85% c) 24.82% d) 28.42%

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