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Scenario #1: January 1, 2012, Smith Corp. received an offer from a competitor to buy some of its equipment. The competitor would pay $500,000 for
Scenario #1:
January 1, 2012, Smith Corp. received an offer from a competitor to buy some of its equipment. The competitor would pay $500,000 for the equipment on December 31, 2015. The equipment is worth $300,000 on January 1, 2012, when the prevailing interest rate is 10% compounded annually. Should Smith Corp. accept this off On er?
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