You can buy property today for $2.0 million and sell it in 4 years for $3.0 million. (You earn no rental income on the property.)

a.If the interest rate is 12%, what is the present value of the sales price?(Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places.)

b.Is the property investment attractive to you?

c-1.What is the present value of the future cash flows, if you also could earn $100,000 per year rent on the property? The rent is paid at the end of each year.(Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places.)

c-2.Is the property investment attractive to you now?

11) A factory costs $310,000. You forecast that it will produce cash inflows of $95,000 in year 1, $155,000 in year 2, and $250,000 in year 3. The discount rate is 12%.

a.What is the value of the factory?(Do not round intermediate calculations. Round your answer to 2 decimal places.)

b.Is the factory a good investment?

12) Revenues generated by a new fad product are forecast as follows: