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Question 1 (25 points): A project needs an initial investment of $150,000 at time zero and is expected to generate a minimum rate of return
Question 1 (25 points): A project needs an initial investment of $150,000 at time zero and is expected to generate a minimum rate of return of 12%. Two possible outcomes are: Success with an annual revenue of $95,000 for 12 years (from year 1 to 12) with no salvage value. Failure with no income, but a salvage value of $75,000 at the end of year 1. What is the minimum probability of success for the project to be considered economically satisfactory on the basis of expected NPV
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