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Consider the investment project with the net cash flows shown. One value of the break-even interest rate (i*) for this project is 27.96%. This means

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Consider the investment project with the net cash flows shown. One value of the break-even interest rate (i*) for this project is 27.96%. This means at this interest rate the project balance calculated at year 3 (PB3) will be zero. At this same interest rate, what is the project balance calculated at year 2 (PB2)? n Net Cash Flow -4000 1 5000 2 15000 3 - 19000 (Chapter 7- Rate of Return Analysis)

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