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Assume that a company owns an apartment building that has net cash flows of $1,000,000 for each of the next three years, at which point

Assume that a company owns an apartment building that has net cash flows of $1,000,000 for each of the next three years, at which point the building will be replaced. The discount rate is 6%. The firm does an impairment test on the building. Identify a possible value for the building on the balance sheet before the impairment test that has the following property: the value on the balance sheet after the impairment test equals the economic value.

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