Question 16, P11-22 (sl.. HW Score: 19.17%, 9.58 of 50 points Homework: Homework Set 4 Save Par. 14 O Points: 0 of 2 Your current opportunity cost is 1.24% por yaar Horarivartha Fnd has steded that inflation may ns by 1.5% ar may fal u 126 Initially. The Investment has a 5-year horizon and promises Ruture end-of-yor cash indows or $12.800 $12.915 $11.685. $9.225. and $8.510 respectively Impact of inflation on investments Personal Finance Problem You are interested in an investment project that costs $45, Semounta nt over the next years Assume a Cirect positive impact of inflation on the prevailing rates (Fisher effects and answer the following questions: Assuine that inflation has an impact on the opportunity cost, but that cash flows are contractually fixed and are not affected by inflation.) a. What is the net present value (NPVI of the investment under the current required rate of retur? b. What the present value INPV) of the investment under a period of rising Inflation? c. What is the nel preseril value (NPV) of the investiment under a period of falling in Nation? d. From your answers in (al, (b) and el, what relationshlo do you see emerge between changes in inflation and asset valuation? a. The net present value of the investment under the current required rate of return is $. Round to the nearest cent.)