What the npv of the new wilderness campsite is

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Kampgrounds Inc. is considering purchasing a parcel of wilderness land near a popular historic site. Although this land will cost Kampgrounds $437,850 today, by renting out wilderness campsites on this land, Kampgrounds expects to make $39,507 at the end of every year indefinitely.

problem 1: If the appropriate discount rate is 5%, then the NPV of this new wilderness campsite is

problem 2: What is the present value of 1,236 received 5 years from today, if interest rate is 5% ?

problem 3: Suppose that a young couple has just had their first baby today and they wish to ensure that enough money will be available to pay for their? child's college education. ? Currently, college? tuition, books,? fees, and other? costs, average? $21,968 per year. Assuming that costs continue to increase an average of? 2% per? year, tuition and other costs per year for this student in 18 years when she enters college will be __________

 

Reference no: EM132790274

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