Question
You have been offered a unique investment opportunity. If you invest $25,000 today, you will receive $1,250 one year from now, $3,750 two years from
You have been offered a unique investment opportunity. If you invest $25,000 today, you will receive $1,250 one year from now, $3,750 two years from now, and $25,000 ten years from now.
A) What is the NPV of the investment opportunity if the interest rate is 10% per year? Should you take the opportunity?
B) What is the NPV of the investment opportunity if the interest rate is 6% per year? Should you take the opportunity?
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Fundamentals Of Corporate Finance
Authors: Stephen Ross, Randolph Westerfield, Bradford Jordan
13th Edition
1265553602, 978-1265553609
