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PLEASE ANSWER THE LAST PART Consider a project that requires an initial investment of $98,000 and will produce a single cash flow of $154,000 in
PLEASE ANSWER THE LAST PART
Consider a project that requires an initial investment of $98,000 and will produce a single cash flow of $154,000 in 6 years. a. What is the NPV of this project if the 6-year interest rate is 5.2% (EAR)? b. What is the NPV of this project if the 6-year interest rate is 9.9% (EAR)? c. What is the highest 6-year interest rate such that this project is still profitable? a. What is the NPV of this project if the 6-year interest rate is 5.2% (EAR)? The NPV in this case (EAR = 5.2%) is $ 15613. (Round to the nearest dollar.) b. What is the NPV of this project if the 6-year interest rate is 9.9% (EAR)? The NPV in this case (EAR = 9.9%) is $ - 10595. (Round to the nearest dollar.) c. What is the highest 6-year interest rate such that this project is still profitable? The highest EAR such that this project is still profitable is %. (Round to two decimal places.)Step by Step Solution
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