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Your favorite aunt and uncle give you $20,000 and ask that you invest in one of three different areas: real estate, bonds, or stocks. If

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Your favorite aunt and uncle give you $20,000 and ask that you invest in one of three different areas: real estate, bonds, or stocks. If you invest the entire amount in of these with the expected cash flows shown below, which investment offers the highest NPV? Assume that an 8% discount rate would be good for all three investments. Cash Inflows Investment Real Estate Bonds Stock Market Year 1 $2,000 $1,500 $3,000 Year 2 $2,000 $1,500 $3.100 Year 3 $2,000 $1,500 $3,500 Year 4 $2,000 $1,500 $2,600 Year 5 $11,000 $11,000 $8,000 Please state any assumptions you are making in your answers

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