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You are raising money for a new project, which is expected to pay $250K as a lump sum in three years. There will be no
You are raising money for a new project, which is expected to pay $250K as a lump sum in three years. There will be no other cash flows. You approach investors for funding, and they inform you that they require an average annual return of 20% because your enterprise is rather risky to them. How much money will the investors provide today, to be able to earn the required rate of return from your project?
a. | 100K | |
b. | 175K | |
c. | 145K | |
d. | 125K |
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