Question
You run a construction firm. You have just won a contract to build a government office complex. Building it will require an investment of $9.5
You run a construction firm. You have just won a contract to build a government office complex. Building it will require an investment of $9.5 million today and $4.9 million in one year. The government will pay you $20.8 million in one year upon the building's completion. Suppose the interest rate is 10.4%.
a. What is the NPV of this opportunity?
b. How can your firm turn this NPV into cash today?
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Introduction To Finance Financial Management And Investment Management
Authors: Pamela P. Drake, Frank J. Fabozzi, Francesco A. Fabozzi
1st Edition
9811239657, 978-9811239656
