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These cash returns are expected to remain constant in real

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You have inherited 250 acres of prime Iowa farmland. There is an active market in land of this type, and similar properties are selling for $1,000 per acre. Net cash returns per acre are $75 per year. These cash returns are expected to remain constant in real terms. How much is the land worth? Alocal banker has advised you to use a 12 percent discount rate.

Reference no: EM13480895

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