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Information on a prospective investment for Wells Financial Services is given below. In each period, funds available for investment come from two sources: loan funds
Information on a prospective investment for Wells Financial Services is given below.
In each period, funds available for investment come from two sources: loan funds and income from the previous period's investment. Expenses, or cash outflows, in each
period must include repayment of the previous period's loan plus interest and the current payroll payment. In addition, to end the planning horizon, investment income
from period at of the investment must be sufficient to cover the loan plus interest from period The difference in these two quantities represents net income and
is to be maximized. How much should be borrowed and how much should be invested each period? Let loan amount in period loan amount in period
loan amount in period loan amount in period investment amount in period investment amount in period investment amount in period
and investment amount in period Round your answers to the nearest whole number.
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