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Suppose a capital investment will generate cash flows in with an expected value of $ 1 , 5 0 0 for each of the four

Suppose a capital investment will generate cash flows in with an expected value of $1,500 for each of the four years and standard deviation of $400. The risk-free rate is 5% and the company uses a 10% required return for investments with this level of risk. Find certainty equivalent.
a. $4754.80. b. $2,000. c. $1,340.41. d. $925.42.

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