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You are offered a four - year investment opportunity costing $ 4 5 0 , 0 0 0 today. The investment will pay $ 1
You are offered a fouryear investment opportunity costing $ today. The investment will pay $ in the first year, $ in the second year, $ in the third year, and $ in the fourth year.. Investments of comparable risk require a rate of return in the financial market. Should you accept the investment opportunity and why?
A No because the investment's net present value is negative.
B No because the investment's net present value is zero.
C Yes, because the investment's cash payments represent a total return of on the $ investment.
D Yes, those cash payments look good to me because they add up to $ which is more than the $ investment.
E Yes, because the investment's net present value is greater than zero.
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