Find the return expected on investment measured in dollar

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Reference no: EM13477005

Consider the following investment cash flows:

Year	Cash Flow
0	($1000)
1	250
2	400
3	500
4	600
5	600

a. What is the return expected on this investmentmeasured in dollar terms if the opportunity cost rate is 10 percent?

b. Provide an explanation, in economics terms, of your answer.

c. What is the return on this investment measured in percentage terms?

d. Should this investment be made? Explain your answer.

Reference no: EM13477005

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