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b.

You have been offered a unique investment opportunity. If you invest $11,800 today, you will receive $590 one year from now, $1,770 two years from now, and $11.800 ten years from now. a. What is the NPV of the opportunity if the cost of capital is 6.3% per year? Should you take the opportunity? b. What is the NPV of the opportunity if the cost of capital is 2.3% per year? Should you take it now? a. What is the NPV of the opportunity if the cost of capital is 6.3% per year? If the cost of capital is 6.3% per year, the NPV is $. (Round to the nearest cent.) Kartman Corporation is evaluating four different real estate investments. Management plans to buy the properties today and sell them three years from today. The annual discount rate for these investments is 12%. The following table summarizes the initial cost and the sale price in three years for each property: Parkside Acres Real Property Estates Lost Lake Properties Overlook Cost Today $590,000 990,000 580,000 90,000 Sale Price in Year 3 $1,090.000 1,590,000 980,000 290,000 Kartman has a total capital budget of $680,000 to invest in properties. Which properties should it choose? The profitability index for Parkside Acres is (Round to two decimal places.)