Question
information An investor buys a building for $300,000 cash and leases it for payments of: Year 1 - $40,000 Year 2 - $50,000 Year 3
information
An investor buys a building for $300,000 cash and leases it for payments of:
Year 1 - $40,000
Year 2 - $50,000
Year 3 - $60,000
At the end of Year 3, the building will be sold for $400,000 in net sales proceeds. Similar investments yield an 11% return.
Questions
1.What is the Net Present Value (NPV)?
2.What is the Internal Rate of Return (IRR)?
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Accounting
Authors: Carl S Warren, James M Reeve, Jonathan Duchac
24th Edition
0538475005, 9780538475006
