If Trevor uses the MARR that accounts for the effect of anticipated inflation on the basis of CPI and determines cash flows in terms of actual dollars then he estimates investment incorrectly will not be able to estimate investment overestimates investment estimates investment correctly underestimates investment A municipality issued bonds to finance its infrastructure projects. The bonds pay interest of 6.5% per year. Jillian is purchasing these bonds in total value of $7,000. She is assuming the inflation rate of 3.5% over the next year, what will be the real value of her bonds at the end of that year? $7, 455 $7, 841 $7, 908 $7, 624 $7, 203 Jason inherited $6,000 from his grandfather. He decided to invest these funds into a two-year project that promises him a return of $2,000 by the end of this year and $4, 500 at the end of the next year. Jason uses analytical report which states that inflation is expected to be 3.0% over the next 5 years. Jason also decided that he would only invest in this project if it could bring him a real rate of return of at least 10%. What is the present worth of his return? $5, 084 $5, 271 $5, 127 $5, 289 $5, 198