Choosing between the two investment alternatives

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Reference no: EM131967583

Suppose that you are evaluating two investments, both of which require you to pay $5,000 today. Investment A will pay you $7,020 in five years, whereas Investment B will pay you $8,126 in eight years.

a. Based only on the return you would earn from each investment (I/Y), which is better?

b. Can you think of any factors other than the expected return that might be important to consider when choosing between the two investment alternatives?

Reference no: EM131967583

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