In return for an outlay of $1000 now and a further outlay of $600 after four years, a business venture will provide a single receipt of $K in one years time K is greater than 0.

a) Measuring time in years, write down the equation NPV 0 (i) = for the transaction.

b) show that (i) If K greater than 1600 the equation has one positive root

(ii) If 1544.4 < K < 1600 the equation has two positive roots