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You have been offered a unique investment opportunity. If you invest $10,300 today, you will receive $515 one year from now, $1,545 two years from
You have been offered a unique investment opportunity. If you invest $10,300 today, you will receive $515 one year from now, $1,545 two years from now, and $10,300 ten years from now.
A. What is the NPV of the opportunity if the cost of capital is 5.4% per year? Should you take the opportunity?
b. What is the NPV of the opportunity if the cost of capital is 1.4% per year? Should you take it now?
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