The neighbour that you have been renting land from for the last 5 years has decided to sell you the section of land (640 ac) for $2,000 per acre. Answer the following: Be sure to show your work.

1. Use net present value analysis (5% discount rate) to determine which financing offer is the better deal. (Hint: Dont forget to include the down payment you need to make for the bank loan.) (3 marks)