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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,
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 12% per year? Should you take the opportunity? b. What is the NPV of the investment opportunity if the interest rate is 8% per year? Should you take the opportunity?
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