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Two mutually exclusive investment opportunities require an initial investment of $5 million. Investment A generates $1.5 million per years in perpetuity, while investment b pays

Two mutually exclusive investment opportunities require an initial investment of $5 million. Investment A generates $1.5 million per years in perpetuity, while investment b pays $1 million in the first year, with cash flows increasing by 3% per year after that. At what cost of capital would an investor regard both opportunities as being equivalent?

A) 3%

B) 6%

C) 9%

D) 10%

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