What is its net present value

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Reference no: EM132398455

1) Consider an investment that will pay you $3,000 per month for each of the next 3 years, and then $5,000 per month in the following 5 years.

a) If your required rate of return on this investment is 18 percent per year, what is the most you would be willing to pay for it?

b) Suppose you can purchase this investment for $150,000. What is its net present value? Should you purchase this investment?

Reference no: EM132398455

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