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Problem 3 - 1 0 John is considering the purchase of a lot. He can buy the lot today and expects the price to rise
Problem
John is considering the purchase of a lot. He can buy the lot today and expects the price to rise to $ at the end of years. He believes that he should earn an investment yield of percent compounded annually on his investment. The asking price for the lot is $
Required:
a What is the internal rate of return compounded annually on the investment if John purchases the property for $ and is able to sell it years later for $
Note: Do not round your intermediate calculations and round your final answer to decimal places.
b Should he buy the lot?
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