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Question 2 Assume there are two plots of vineyard land, x and Y . If x costs twice as much as Y and rents and
Question Assume there are two plots of vineyard land, and If costs twice as much as and rents and discount rates are the same for each plot, the price difference can only be caused by different growth rates. a For both plots, provide an abstract equation for the growth rate g Denote plot s price NPV: b Based on your answer to a and assuming that the pricetorent ratio for plot equals and What are the respective growth rates Report percentdecimals, eg
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Assume there are two plots of vineyard land, and If costs twice as much as and rents and discount rates are the same for each plot, the price difference can only be caused by different growth rates.
a For both plots, provide an abstract equation for the growth rate g Denote plot s price NPV:
b Based on your answer to a and assuming that the pricetorent ratio for plot equals and What are the respective growth rates Report percentdecimals, eg
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