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O Your corporation is evaluating four investments. Management plans to buy the properties today and sell them four years from today. The annual discount
O Your corporation is evaluating four investments. Management plans to buy the properties today and sell them four years from today. The annual discount rate for these investments is 15%. The following table summarizes the initial cost and the sale price in three years for each property: Cost Today Profit Year 4 Project A $850,000 $2,150,000 Project B 850,000 1,600,000 Project C 750,000 1,350,000 Project D 150,000 350,000 The Company has a total capital budget of $1,000,000 to invest in properties. Which properties should it choose?
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