Assume you have both taxes and inflation. You are in the 20% tax bracket, and the inflation
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Assume you have both taxes and inflation. You are in the 20% tax bracket, and the inflation rate is 5% per year. A 1-year project offers you $3,000 return for a $20,000 investment. Taxable bonds offer a rate of return of 10% per year. What is the NPV of this project? Extra credit if you can derive the formula yourself!
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