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Anna has a business opportunity that costs $25,000 at time 0. It returns $15,000 and time 1 and $20,000 at time 2. All these figures
Anna has a business opportunity that costs $25,000 at time 0. It returns $15,000 and time 1 and $20,000 at time 2. All these figures are in nominal terms. Anna's real discount rate is 3.8%, and the inflation rate is 4%. What is the real NPV of the business opportunity at time 0? Choose the nearest answer. a. 7,900 b. 12,000 c. 8,000 d. 6,000 e. 4000
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