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o is 45%, and the after-tax required rate of return is 18%, which includes a 2% element attributable to inflation. Click the icon to view
o is 45%, and the after-tax required rate of return is 18%, which includes a 2% element attributable to inflation. Click the icon to view the present value factor table.) Click the icon to view the present value annuity factor table.) (Click the icon to view the selected MACRS depreciation schedule.) ad the Data table Data table x Requirements 1. Compute the NPV of the computers. Use the nominal required rate of return and adjust the cash flows for inflation. (For example, year 1 cash flow =1.02 year 0 cash flow.) 2. Compute the NPV of the computers using the nominal required rate of return without 3. Compare your answers in numbition. 3. Compare your answers in numbers 1 and 2. Which is correct? Would using the incorrect analysis generally lead to overinvestment or underinvestment? Explain
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