Question
Two investment opportunities are open to you: Investment 1 and Investment 2. Each has an initial cost of $15,000. Assuming that you desire a 6
Two investment opportunities are open to you: Investment 1 and Investment 2. Each has an initial cost of $15,000. Assuming that you desire a 6 percent return on your initial investment, compute the net present value of the two alternatives. Use Table II or a financial calculator to answer the question. Round your answers to the nearest dollar.
| Investment 1 | Investment 2 | ||
| Cash Flows | Year | Cash Flows | Year |
| $3,000 | 1 | $9,000 | 1 |
| $5,000 | 2 | $7,000 | 2 |
| $7,000 | 3 | $5,000 | 3 |
| $9,000 | 4 | $3,000 | 4 |
Investment 1: $
Investment 2: $
Which alternative is more attractive?
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Public School Finance Decoded
Authors: Jay C. Toland
1st Edition
1475827679, 978-1475827675
