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Problem 3 An investment has an initial cost of $1000 at time 0. The cash flows in the future are paid at the end of

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Problem 3 An investment has an initial cost of $1000 at time 0. The cash flows in the future are paid at the end of each year starting with $300 at time 1 and increase by 5% each year until the last payment at time 5. Assume the interest rate on the investment is 10%. A) Calculate the net present value of the investment. B) Calculate the net present value of the investment for different values of the compound increasing factor: -5%, 0%, 5%, 10%, 15% C) Is the net present value an increasing, decreasing, or monotone function of the compound increasing factor

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