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Calculate the NPV of the difference in the cash flows under both holding period assumptions for a range of discount rates. Based on your answer

  1. Calculate the NPV of the difference in the cash flows under both holding period assumptions for a range of discount rates. Based on your answer to Question 8, what is the correct discount rate to use?
What answer are they looking for... A larger or smaller NPV for the difference? Intuitively I would say smaller, so than does that mean the the correct discount rate is the larger one?

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