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Question 1 Given the following information and options, calculate how many years this project should be run before it is retired. Assume the cost of
Question 1
Given the following information and options, calculate how many years this project should be run before it is retired. Assume the cost of capital is 10% p.a. Maximum life is five years.
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Net Cash Flows ($) (10,000) 2,200 3,000 3,500 2,500 2,000 Retirement Values ($) 6,000 5,000 4,000 3,000 1,000
One year.
Three years.
Five years.
Cannot be determined.
Four years.
Two years.
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