Solution-Explain the percent discount rate

Explain the percent discount rate

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Reference no: EM133122804

Your grandmother gives you $50,000 to be invested in one of three opportunities: real estate, regular bonds, or zero coupon bonds. If you invest the entire $50,000 in one of these opportunities with the expected cash flows shown below, which investment offers the highest NPV? Assume for simplicity that an 8 percent discount rate is appropriate for all three investments. Use only excel to solve?

	Year 1	Year 2	Year 3	Year 4	Year 5
Real Estate	$3,400	$3,400	$3,400	$1,700	$63,400
Bond	$6,000	$6,000	$6,000	$6,000	$56,000
Zero Coupon	$0	$0	$0	$0	$85,000

Reference no: EM133122804

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Explain the percent discount rate

Reference no: EM133122804

Reference no: EM133122804

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