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You are thinking about investing $ 4 comma 859$4,859 in your friend's landscaping business. Even though you know the investment is risky and you can't
You are thinking about investing
$ 4 comma 859$4,859
in your friend's landscaping business. Even though you know the investment is risky and you can't be sure, you expect your investment to be worth
$5,651
next year. You notice that the rate for one-year Treasury bills is
1%.
However, you feel that other investments of equal risk to yourfriend's landscape business offer an expected return of
8%
for the year. What should you do?
You are thinking about investing $4,859 in your friend's landscaping business. Even though you know the investment is risky and you can't be sure, you expect your investment to be worth $5,651 next year. You notice that the rate for one-year Treasury bills is 1%. However, you feel that other investments of equal risk to your friend's landscape business offer an expected return of 8% for the year. What should you do? The present value of the return is Round to the nearest cent.)Step by Step Solution
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