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This question has multiple parts. A farmer sows a certain crop. It costs $200,000 to buy the seed, prepare the ground, and sow the crop.

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This question has multiple parts. A farmer sows a certain crop. It costs $200,000 to buy the seed, prepare the ground, and sow the crop. In one year's time it will cont $172,000 to harvest the crop. The farmer's bent entmate is that the crop will be worth $390,000 in one year. The farmer can borrow and lend at an interest rate is 9%. Part A) The net present value (NPV) of the farmer's decision to proceed wath this investment is closest to which of the following? A. 50 B. 5200.000 C. $557,796 D. 5157,198 Part B) The farmer is concemed about the uncedainty surrounding the price that she will recolve for her harvested crop in one yoar. She has the opportunity to entar ineo a forward ageedrioill whereby she can lock-in a sale price of \$415,000 for her harvested crop in ono year, twus elirinating any uncertainty. The cost of entering into this contract is s23, S00, payabie fodoy. Should the farmer enter inte this forward agreement and lock-in the sale price of ber harvested crop? A. Yes, she should enser into this agreement. B. No, she should not enter into tis agreement, Part c) What price would the tarmer need to pry for the forward agreereet described in Part B such that the NPV of her overal taming investment would be inchanged from thal caicuated in Fiart A? Price of forward contract wich that NPV is unchanged: (please round your anwer to the nearest dollar)

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