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Billy Bob is considering building a water slide park that will require a net investment of $200,000 and yield the following net cash flows: YearNet
Billy Bob is considering building a water slide park that will require a net investment of $200,000 and yield the following net cash flows: YearNet Cash FlowsCert. Equiv. Factor Yr 1$120,000 .90 Yr 290,000.80 Yr 360,000.65 yr 510,000.30 If the risk-free rate is 8 percent and the market risk premium is 6 percent, what is the certainty equivalent NPV for this project?
$12,805 | ||
$ 5,746 | ||
$ 3,703 | ||
$11,025 |
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